It is usually uneventful when a single insider buys stock. However, When quite a few insiders buy shares, as it happened in Flexsteel Industries, Inc.’s (NASDAQ:FLXS) case, it’s fantastic 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, logic dictates you should pay some attention to whether insiders are buying or selling shares.
Flexsteel Industries Insider Transactions Over The Last Year
The Chief Operating Officer Derek Schmidt made the biggest insider purchase in the last 12 months. That single transaction was for US$383k worth of shares at a price of US$22.82 each. That means that even when the share price was higher than US$17.10 (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. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.
While Flexsteel Industries insiders bought shares during the last year, they didn’t sell. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
Flexsteel Industries is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Are Flexsteel Industries Insiders Buying Or Selling?
There was some insider buying at Flexsteel Industries over the last quarter. Chief Operating Officer Derek Schmidt bought US$8.9k worth of shares in that time. We like it when there are only buyers, and no sellers. But the amount invested in the last three months isn’t enough for us too put much weight on it, as a single factor.
Does Flexsteel Industries Boast High Insider Ownership?
For a common shareholder, it is worth checking how many shares are held by company 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. Insiders own 21% of Flexsteel Industries shares, worth about US$20m. While this is a strong but not outstanding level of insider ownership, it’s enough to indicate some alignment between management and smaller shareholders.
What Might The Insider Transactions At Flexsteel Industries Tell Us?
We note a that there has been a bit of insider buying recently (but no selling). The net investment is not enough to encourage us much. On a brighter note, the transactions over the last year are encouraging. Insiders own shares in Flexsteel Industries and we see no evidence to suggest they are worried about the future. 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. In terms of investment risks, we’ve identified 3 warning signs with Flexsteel Industries and understanding these should be part of your investment process.
But note: Flexsteel Industries may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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, 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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