In the last year, multiple insiders have substantially increased their holdings of Option Care Health, Inc. (NASDAQ:OPCH) stock, indicating that insiders' optimism about the company's prospects has increased.
While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.
Check out our latest analysis for Option Care Health
Option Care Health Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when Independent Non Executive Chairman of the Board Harry M. Kraemer bought US$1.9m worth of shares at a price of US$34.63 per share. That means that even when the share price was higher than US$29.31 (the recent price), an insider wanted to purchase shares. Their view may have changed since then, but at least it shows they felt optimistic at the time. We always take careful note of the price insiders pay when purchasing shares. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.
Happily, we note that in the last year insiders paid US$2.1m for 61.97k shares. But they sold 1.54k shares for US$49k. Overall, Option Care Health insiders were net buyers during the last year. You can see the insider transactions (by companies and individuals) 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!
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).
Option Care Health Insiders Bought Stock Recently
It's good to see that Option Care Health insiders have made notable investments in the company's shares. Independent Director Elizabeth Bierbower spent US$79k on stock, and there wasn't any selling. This is a positive in our book as it implies some confidence.
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. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 0.4% of Option Care Health shares, worth about US$22m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
What Might The Insider Transactions At Option Care Health Tell Us?
The recent insider purchase is heartening. And the longer term insider transactions also give us confidence. When combined with notable insider ownership, these factors suggest Option Care Health insiders are well aligned, and that they may think the share price is too low. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Option Care Health. At Simply Wall St, we've found that Option Care Health has 3 warning signs (1 is a bit unpleasant!) that deserve your attention before going any further with your analysis.
Of course Option Care Health 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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.