Some Diamondback Energy, Inc. (NASDAQ:FANG) shareholders may be a little concerned to see that the President & CFO, Matthew Van't Hof, recently sold a substantial US$4.9m worth of stock at a price of US$196 per share. That's a big disposal, and it decreased their holding size by 17%, which is notable but not too bad.
Diamondback Energy Insider Transactions Over The Last Year
Notably, that recent sale by Matthew Van't Hof is the biggest insider sale of Diamondback Energy shares that we've seen in the last year. So it's clear an insider wanted to take some cash off the table, even slightly below the current price of US$197. 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. However, while insider selling is sometimes discouraging, it's only a weak signal. This single sale was just 17% of Matthew Van't Hof's stake.
Insiders in Diamondback Energy didn't buy any shares in the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
I will like Diamondback Energy better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.
Does Diamondback Energy Boast High Insider Ownership?
Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. It's great to see that Diamondback Energy insiders own 0.5% of the company, worth about US$169m. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
So What Do The Diamondback Energy Insider Transactions Indicate?
Insiders haven't bought Diamondback Energy stock in the last three months, but there was some selling. And even if we look at the last year, we didn't see any purchases. It is good to see high insider ownership, but the insider selling leaves us cautious. 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. For example - Diamondback Energy has 2 warning signs we think you should be aware of.
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 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.