We often see insiders buying up shares in companies that perform well over the long term. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So shareholders might well want to know whether insiders have been buying or selling shares in Four Corners Property Trust, Inc. (NYSE:FCPT).
What Is Insider Selling?
It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, rules govern insider transactions, and certain disclosures are required.
Insider transactions are not the most important thing when it comes to long-term investing. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year.'
The Last 12 Months Of Insider Transactions At Four Corners Property Trust
Over the last year, we can see that the biggest insider sale was by the General Counsel & Secretary, James Brat, for US$164k worth of shares, at about US$27.41 per share. That means that an insider was selling shares at slightly below the current price (US$28.67). As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. This single sale was just 15.1% of James Brat's stake.
Over the last year, we note insiders sold 13718 shares worth US$374k. Four Corners Property Trust insiders didn't buy any shares over the last year. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.
Four Corners Property Trust Insiders Are Selling The Stock
We have seen a bit of insider selling at Four Corners Property Trust, over the last three months. Chief Accounting Officer Niccole Stewart only netted US$22k selling shares, in that period. Neither the lack of buying nor the presence of selling is heartening. But the amount sold isn't enough for us to put any weight on it.
Insider Ownership of Four Corners Property Trust
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. 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 Four Corners Property Trust insiders own 0.8% of the company, worth about US$15m. 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 Four Corners Property Trust Insiders?
Our data shows a little more insider selling, but no insider buying, in the last three months. But given the selling was modest, we're not worried. Recent sales exacerbate our caution arising from analysis of Four Corners Property Trust insider transactions. 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 Four Corners Property Trust, you should check out this free report on analyst forecasts for the company.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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, but not derivative transactions.
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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.