We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sell John B. Sanfilippo & Son, Inc. (NASDAQ:JBSS), you may well want to know whether insiders have been buying or selling.
What Is Insider Selling?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock in the company. However, rules govern insider transactions, and certain disclosures are required.
We don't think shareholders should simply follow insider transactions. But logic dictates you should pay some attention to whether insiders are buying or selling shares. 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 John B. Sanfilippo & Son
In the last twelve months, the biggest single sale by an insider was when the Senior Vice President of Consumer Sales , Christopher Gardier, sold US$884k worth of shares at a price of US$79.42 per share. That means that an insider was selling shares at slightly below the current price (US$94.77). 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. It is worth noting that this sale was 75.7% of Christopher Gardier's holding.
In the last twelve months insiders netted US$4.2m for 49585 shares sold. John B. Sanfilippo & Son 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!
I will like John B. Sanfilippo & Son better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
Insiders at John B. Sanfilippo & Son Have Sold Stock Recently
The last quarter saw substantial insider selling of John B. Sanfilippo & Son shares. Specifically, insiders ditched US$1.6m worth of shares in that time, and we didn't record any purchases whatsoever. Overall this makes us a bit cautious, but it's not the be all and end all.
Insider Ownership of John B. Sanfilippo & Son
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. John B. Sanfilippo & Son insiders own 13% of the company, currently worth about US$143m based on the recent share price. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
What Might The Insider Transactions At John B. Sanfilippo & Son Tell Us?
Insiders haven't bought John B. Sanfilippo & Son stock in the last three months, but there was some selling. And there weren't any purchases to give us comfort, over the last year. But it is good to see that John B. Sanfilippo & Son is growing earnings. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. Of course, the future is what matters most. So if you are interested in John B. Sanfilippo & Son, you should check out this free report on analyst forecasts for the company.
But note: John B. Sanfilippo & Son may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
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.