We wouldn't blame Warrior Met Coal, Inc. (NYSE:HCC) shareholders if they were a little worried about the fact that Stephen Williams, the Director recently netted about US$3.6m selling shares at an average price of US$45.60. That diminished their holding by a very significant 79%, which arguably implies a strong desire to reallocate capital.
See our latest analysis for Warrior Met Coal
Warrior Met Coal Insider Transactions Over The Last Year
In fact, the recent sale by Stephen Williams was the biggest sale of Warrior Met Coal shares made by an insider individual in the last twelve months, according to our records. That means that an insider was selling shares at slightly below the current price (US$49.98). 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. However, while insider selling is sometimes discouraging, it's only a weak signal. This single sale was 79% of Stephen Williams's stake.
You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
I will like Warrior Met Coal better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
Does Warrior Met Coal Boast High Insider Ownership?
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. Insiders own 1.5% of Warrior Met Coal shares, worth about US$37m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
So What Does This Data Suggest About Warrior Met Coal Insiders?
An insider sold Warrior Met Coal shares recently, but they didn't buy any. And even if we look at the last year, we didn't see any purchases. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. So we'd only buy after careful consideration. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Warrior Met Coal. Every company has risks, and we've spotted 3 warning signs for Warrior Met Coal (of which 1 makes us a bit uncomfortable!) you should know about.
Of course Warrior Met Coal may not be the best stock to buy. So you may wish to see this free collection of high quality 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 of direct interests only, but not derivative transactions or indirect interests.
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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.