We'd be surprised if Immersion Corporation (NASDAQ:IMMR) shareholders haven't noticed that the Lead Independent Director, Elias Nader, recently sold US$107k worth of stock at US$8.22 per share. The eyebrow raising move amounted to a reduction of 31% in their holding.
The Last 12 Months Of Insider Transactions At Immersion
Notably, that recent sale by Elias Nader is the biggest insider sale of Immersion shares that we've seen in the last year. That means that even when the share price was slightly below the current price of US$8.37, an insider wanted to cash in some shares. 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 just 31% of Elias Nader's stake.
You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
I will like Immersion 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
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. Insiders own 8.1% of Immersion shares, worth about US$21m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
What Might The Insider Transactions At Immersion Tell Us?
An insider sold stock recently, but they haven't been buying. And even if we look at the last year, we didn't see any purchases. On the plus side, Immersion makes money, and is growing profits. While insiders do own shares, they don't own a heap, and they have been selling. We're in no rush to buy! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For instance, we've identified 3 warning signs for Immersion (1 is significant) you should be aware of.
Of course Immersion 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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