We’ve lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. On the other hand, we’d be remiss not to mention that insider sales have been known to precede tough periods for a business. So before you buy or sell Continental Building Products, Inc. (NYSE:CBPX), you may well want to know whether insiders have been buying or selling.
Do Insider Transactions Matter?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, rules govern insider transactions, and certain disclosures are required.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But equally, we would consider it foolish to ignore insider transactions altogether. As Peter Lynch said, ‘insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.’
The Last 12 Months Of Insider Transactions At Continental Building Products
Senior VP Dennis Romps made the biggest insider sale in the last 12 months. That single transaction was for US$91k worth of shares at a price of US$36.20 each. While the sale doesn’t make us feel confident, we do note it was conducted at a price well above the current share price, which is US$26.78. So it may not tell us anything about how insiders feel about the current share price.
All up, insiders sold more shares in Continental Building Products than they bought, over the last year. The sellers received a price of around US$34.44, on average. We are not joyful about insider selling. But the selling was at much higher prices than the current share price (US$26.78), so it probably doesn’t tell us a lot about the value on offer today. You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Does Continental Building Products Boast High Insider Ownership?
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. We usually like to see fairly high levels of insider ownership. Insiders own 1.4% of Continental Building Products shares, worth about US$14m. While this is a strong but not outstanding level of insider ownership, it’s enough to indicate some alignment between management and smaller shareholders.
So What Does This Data Suggest About Continental Building Products Insiders?
There haven’t been any insider transactions in the last three months — that doesn’t mean much. Our analysis of Continental Building Products insider transactions leaves us cautious. But we do like the fact that insiders own a fair chunk of the company. Of course, the future is what matters most. So if you are interested in Continental Building Products, you should check out this free report on analyst forecasts for the company.
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.
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If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.