We wouldn't blame AAON, Inc. (NASDAQ:AAON) shareholders if they were a little worried about the fact that Norman Asbjornson, the Founder recently netted about US$1.6m selling shares at an average price of US$80.48. However, that sale only accounted for 0.1% of their holding, so arguably it doesn't say much about their conviction.
AAON Insider Transactions Over The Last Year
In fact, the recent sale by Founder Norman Asbjornson was not their only sale of AAON shares this year. Earlier in the year, they fetched US$63.48 per share in a -US$6.3m sale. That means that an insider was selling shares at slightly below the current price (US$81.30). We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. This single sale was just 0.7% of Norman Asbjornson's stake.
Norman Asbjornson sold a total of 124.92k shares over the year at an average price of US$66.20. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
I will like AAON better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
Insider Ownership
Many investors like to check how much of a company is owned by insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. AAON insiders own 18% of the company, currently worth about US$1.2b based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
What Might The Insider Transactions At AAON Tell Us?
An insider hasn't bought AAON stock in the last three months, but there was some selling. And our longer term analysis of insider transactions didn't bring confidence, either. On the plus side, AAON makes money, and is growing profits. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Case in point: We've spotted 1 warning sign for AAON you should be aware of.
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 of direct interests only, but not derivative transactions or indirect interests.
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