Investors who take an interest in Alliance Data Systems Corporation (NYSE:ADS) should definitely note that the Non-Executive Chairman, Robert Minicucci, recently paid US$28.99 per share to buy US$290k worth of the stock. Although the purchase only increased their holding by 9.7%, it is still a solid purchase in our view.
Alliance Data Systems Insider Transactions Over The Last Year
In the last twelve months, the biggest single sale by an insider was when the Executive VP & CFO, Timothy King, sold US$406k worth of shares at a price of US$156 per share. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. The silver lining is that this sell-down took place above the latest price (US$27.55). So it is hard to draw any strong conclusion from it. Timothy King was the only individual insider to sell shares in the last twelve months.
Over the last year, we can see that insiders have bought 19.63k shares worth US$549k. But they sold 2600 shares for US$406k. In the last twelve months there was more buying than selling by Alliance Data Systems insiders. You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
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 of Alliance Data Systems
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. Alliance Data Systems insiders own about US$37m worth of shares. That equates to 2.8% of the company. 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 Do The Alliance Data Systems Insider Transactions Indicate?
The recent insider purchases are heartening. And an analysis of the transactions over the last year also gives us confidence. Given that insiders also own a fair bit of Alliance Data Systems we think they are probably pretty confident of a bright future. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. To help with this, we've discovered 5 warning signs (1 is potentially serious!) that you ought to be aware of before buying any shares in Alliance Data Systems.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.
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