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Trade Alert: B. Hughes At American Homes 4 Rent (NYSE:AMH), Has Just Spent US$2.0m Buying A Small Number of Shares

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American Homes 4 Rent (NYSE:AMH) shareholders (or potential shareholders) will be happy to see that insider B. Hughes recently bought a whopping US$2.0m worth of stock, at a price of US$36.93. There's no denying a buy of that magnitude suggests conviction in a brighter future, although we do note that proportionally it only increased their holding by 0.3%.

Check out our latest analysis for American Homes 4 Rent

The Last 12 Months Of Insider Transactions At American Homes 4 Rent

Notably, that recent purchase by B. Hughes was not the only time they bought American Homes 4 Rent shares this year. They previously made an even bigger purchase of US$9.9m worth of shares at a price of US$29.11 per share. Even though the purchase was made at a significantly lower price than the recent price (US$37.62), we still think insider buying is a positive. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

B. Hughes bought 412.10k shares over the last 12 months at an average price of US$30.14. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

insider-trading-volume
insider-trading-volume

There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).

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. American Homes 4 Rent insiders own 13% of the company, currently worth about US$1.7b based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Does This Data Suggest About American Homes 4 Rent Insiders?

The stark truth for American Homes 4 Rent is that there has been more insider selling than insider buying in the last three months. On the other hand, the insider transactions over the last year are encouraging. On top of that, insiders own a significant portion of the company. So we're happy to look past recent trading. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing American Homes 4 Rent. To that end, you should learn about the 4 warning signs we've spotted with American Homes 4 Rent (including 1 which can't be ignored).

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.

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. 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.