Insiders who purchased US$1.2m worth of INNOVATE Corp. (NYSE:VATE) shares over the past year recouped some of their losses after price gained 63% last week. However, total losses seen by insiders are still US$234k since the time of purchase.
Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.
See our latest analysis for INNOVATE
The Last 12 Months Of Insider Transactions At INNOVATE
Over the last year, we can see that the biggest insider purchase was by Independent Chairman of the Board Avram Glazer for US$1.1m worth of shares, at about US$2.92 per share. That means that an insider was happy to buy shares at above the current price of US$2.15. 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.
In the last twelve months insiders purchased 435.24k shares for US$1.2m. But insiders sold 51.71k shares worth US$127k. Overall, INNOVATE insiders were net buyers during the last year. 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!
INNOVATE is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
INNOVATE Insiders Bought Stock Recently
Over the last three months, we've seen a bit of insider buying at INNOVATE. Insiders bought US$24k worth of shares in that time. We like it when there are only buyers, and no sellers. But the amount invested in the last three months isn't enough for us too put much weight on it, as a single factor.
Insider Ownership Of INNOVATE
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It's great to see that INNOVATE insiders own 41% of the company, worth about US$69m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
So What Do The INNOVATE Insider Transactions Indicate?
Our data shows a little insider buying, but no selling, in the last three months. The net investment is not enough to encourage us much. But insiders have shown more of an appetite for the stock, over the last year. Judging from their transactions, and high insider ownership, INNOVATE insiders feel good about the company's future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing INNOVATE. In terms of investment risks, we've identified 4 warning signs with INNOVATE and understanding them should be part of your investment process.
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.