It is usually uneventful when a single insider buys stock. However, When quite a few insiders buy shares, as it happened in American Public Education, Inc.'s (NASDAQ:APEI) case, it's fantastic news for shareholders.
Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.
The Last 12 Months Of Insider Transactions At American Public Education
Over the last year, we can see that the biggest insider purchase was by Independent Director Granetta Blevins for US$102k worth of shares, at about US$3.95 per share. Even though the purchase was made at a significantly lower price than the recent price (US$5.11), we still think insider buying is a positive. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.
Happily, we note that in the last year insiders paid US$315k for 79.00k shares. But they sold 4.95k shares for US$21k. In the last twelve months there was more buying than selling by American Public Education insiders. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
American Public Education is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Does American Public Education Boast High Insider Ownership?
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. I reckon it's a good sign if insiders own a significant number of shares in the company. Based on our data, American Public Education insiders have about 3.2% of the stock, worth approximately US$2.9m. I generally like to see higher levels of ownership.
So What Do The American Public Education Insider Transactions Indicate?
It doesn't really mean much that no insider has traded American Public Education shares in the last quarter. However, our analysis of transactions over the last year is heartening. While we have no worries about the insider transactions, we'd be more comfortable if they owned more American Public Education stock. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. For example - American Public Education has 1 warning sign we think you should be aware of.
Of course American Public Education may not be the best stock to buy. So you may wish to see this free collection of high quality companies.
For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions of direct interests only, but not derivative transactions or indirect interests.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.