When a single insider purchases stock, it is typically not a major deal. However, when multiple insiders purchase stock, like in Hamilton Beach Brands Holding Company's (NYSE:HBB) instance, it's good news for shareholders.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.
The Last 12 Months Of Insider Transactions At Hamilton Beach Brands Holding
Over the last year, we can see that the biggest insider purchase was by Independent Director Paul Furlow for US$191k worth of shares, at about US$11.25 per share. That means that an insider was happy to buy shares at around the current price of US$11.25. Of course they may have changed their mind. But this suggests they are optimistic. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. The good news for Hamilton Beach Brands Holding share holders is that insiders were buying at near the current price.
In the last twelve months Hamilton Beach Brands Holding insiders were buying shares, but not selling. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
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. It appears that Hamilton Beach Brands Holding insiders own 33% of the company, worth about US$52m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
So What Do The Hamilton Beach Brands Holding Insider Transactions Indicate?
It doesn't really mean much that no insider has traded Hamilton Beach Brands Holding shares in the last quarter. On a brighter note, the transactions over the last year are encouraging. Insiders own shares in Hamilton Beach Brands Holding and we see no evidence to suggest they are worried about the future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Hamilton Beach Brands Holding. Our analysis shows 3 warning signs for Hamilton Beach Brands Holding (2 are concerning!) and we strongly recommend you look at these before investing.
Of course Hamilton Beach Brands Holding 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, but not derivative transactions.
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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.
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