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UniFirst Corporation (NYSE:UNF) Insiders Have Been Selling

We often see insiders buying up shares in companies that perform well over the long term. 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 UniFirst Corporation (NYSE:UNF).

What Is Insider Buying?

It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, most countries require that the company discloses such transactions to the market.

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 Colombia 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’.

Check out our latest analysis for UniFirst

UniFirst Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when Cecelia Levenstein sold US$887k worth of shares at a price of US$185 per share. Although we don’t gain confidence from insider selling, we note that this large sale was at well above current price of US$133. So it may not tell us anything about how insiders feel about the current share price.

Over the last year, we note insiders sold 15.86k shares worth US$3.0m. In total, UniFirst insiders sold more than they bought over the last year. The sellers received a price of around US$186, on average. We are not joyful about insider selling. But the selling was at much higher prices than the current share price (US$133), so it probably doesn’t tell us a lot about the value on offer today. You can see the insider transactions over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

NYSE:UNF Insider Trading December 26th 18
NYSE:UNF Insider Trading December 26th 18

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. UniFirst insiders own about US$271m worth of shares (which is 11% of the company). 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 UniFirst Insiders?

There haven’t been any insider transactions in the last three months — that doesn’t mean much. It’s great to see high levels of insider ownership, but looking back at the last year, we don’t gain confidence from the UniFirst insiders selling. If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.

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