Some Denny’s Corporation (NASDAQ:DENN) shareholders may be a little concerned to see that the Senior VP & COO, Christopher Bode, recently sold a whopping US$1.2m worth of stock at a price of US$23.53 per share. That diminished their holding by a very significant 56%, which arguably implies a strong desire to reallocate capital.
The Last 12 Months Of Insider Transactions At Denny’s
Over the last year, we can see that the biggest insider sale was by the CEO, President & Director, John Miller, for US$2.3m worth of shares, at about US$18.25 per share. That means that even when the share price was below the current price of US$23.61, an insider wanted to cash in some shares. 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. Please do note, however, that sellers may have a variety of reasons for selling, so we don’t know for sure what they think of the stock price. We note that the biggest single sale was only 18.8% of John Miller’s holding.
We note that in the last year insiders divested 221k shares for a total of US$4.3m. Insiders in Denny’s didn’t buy any shares in the last year. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
Insider Ownership of Denny’s
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. 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 3.6% of Denny’s shares, worth about US$51m. While this is a strong but not outstanding level of insider ownership, it’s enough to indicate some alignment between management and smaller shareholders.
So What Do The Denny’s Insider Transactions Indicate?
An insider sold stock recently, but they haven’t been buying. And there weren’t any purchases to give us comfort, over the last year. But it is good to see that Denny’s is growing earnings. While insiders do own shares, they don’t own a heap, and they have been selling. We’re in no rush to buy! Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for Denny’s.
But note: Denny’s 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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If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.