Quite a few insiders invested in FreightCar America, Inc. (NASDAQ:RAIL) last year which is positive news for shareholders
When a single insider purchases stock, it is typically not a major deal. However, when multiple insiders purchase stock, like in FreightCar America, Inc.'s (NASDAQ:RAIL) instance, it's good news for shareholders.
Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.
Check out our latest analysis for FreightCar America
The Last 12 Months Of Insider Transactions At FreightCar America
The insider Alejandro Benavides made the biggest insider purchase in the last 12 months. That single transaction was for US$191k worth of shares at a price of US$3.70 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$3.47). It's very possible they regret the purchase, but it's more likely they are bullish about the company. In our view, the price an insider pays for shares is very important. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.
FreightCar America insiders may have bought shares in the last year, but they didn't sell any. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
FreightCar America is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Insider Ownership Of FreightCar America
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It appears that FreightCar America insiders own 20% of the company, worth about US$12m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
So What Do The FreightCar America Insider Transactions Indicate?
There haven't been any insider transactions in the last three months -- that doesn't mean much. But insiders have shown more of an appetite for the stock, over the last year. Insiders do have a stake in FreightCar America and their transactions don't cause us concern. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. At Simply Wall St, we've found that FreightCar America has 4 warning signs (2 are concerning!) that deserve your attention before going any further with your analysis.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity and low debt.
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, but not derivative transactions.
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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.
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