Recent gains in CNH Industrial N.V. (NYSE:CNHI) help add back some value on insider purchases worth US$5.5m, still down US$730k
Insiders who bought US$5.5m worth of CNH Industrial N.V. (NYSE:CNHI) stock in the last year recovered part of their losses as the stock rose by 4.5% last week. The purchase, however, has proven to be a pricey bet, with losses currently totalling US$730k.
While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.
View our latest analysis for CNH Industrial
The Last 12 Months Of Insider Transactions At CNH Industrial
Over the last year, we can see that the biggest insider purchase was by CEO & Executive Director Scott Wine for US$3.3m worth of shares, at about US$16.49 per share. That means that an insider was happy to buy shares at above the current price of US$13.13. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. To us, it's very important to consider the price insiders pay for shares. 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.
Over the last year, we can see that insiders have bought 361.90k shares worth US$5.5m. But they sold 18.57k shares for US$267k. Overall, CNH Industrial insiders were net buyers during the last year. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
Insiders At CNH Industrial Have Bought Stock Recently
Over the last quarter, CNH Industrial insiders have spent a meaningful amount on shares. We can see that Independent Non-Executive Director Karen Linehan paid US$150k for shares in the company. No-one sold. This makes one think the business has some good points.
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. A high insider ownership often makes company leadership more mindful of shareholder interests. CNH Industrial insiders own about US$39m worth of shares. That equates to 0.2% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
What Might The Insider Transactions At CNH Industrial Tell Us?
It's certainly positive to see the recent insider purchase. We also take confidence from the longer term picture of insider transactions. When combined with notable insider ownership, these factors suggest CNH Industrial insiders are well aligned, and that they may think the share price is too low. 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. To help with this, we've discovered 2 warning signs (1 doesn't sit too well with us!) that you ought to be aware of before buying any shares in CNH Industrial.
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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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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