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 we'll take a look at whether insiders have been buying or selling shares in Quotient Technology Inc. (NYSE:QUOT).
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.
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. For example, a Columbia University study found that 'insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers'.
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Quotient Technology Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider sale was by the Chief Marketing & Media Officer, Jason Young, for US$102k worth of shares, at about US$10.23 per share. So it's clear an insider wanted to take some cash off the table, even slightly below the current price of US$10.43. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. This single sale was 73.5% of Jason Young's stake. Jason Young was the only individual insider to sell shares in the last twelve months.
The chart below shows insider transactions (by individuals) over the last year. 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.
Quotient Technology Insiders Are Selling The Stock
Over the last three months, we've seen notably more insider selling, than insider buying, at Quotient Technology. We note Jason Young cashed in US$102k worth of shares. On the other hand we note Director Andrew Gessow bought US$50k worth of shares, as previously mentioned. Because the selling vastly outweighs the buying, we'd say this is a somewhat bearish sign.
Does Quotient Technology 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. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 6.0% of Quotient Technology shares, worth about US$59m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
What Might The Insider Transactions At Quotient Technology Tell Us?
The insider sales have outweighed the insider buying, at Quotient Technology, in the last three months. Despite some insider buying, the longer term picture doesn't make us feel much more positive. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. We'd think twice before buying! Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for Quotient Technology.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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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.