We wouldn’t blame Dana Incorporated (NYSE:DAN) shareholders if they were a little worried about the fact that Mark Wallace, the Executive VP and President of Dana Commercial Vehicle Driveline Tech. recently netted about US$766k selling shares at an average price of US$13.41. That’s a big dump, and it decreased their holding size by 35.8%, which is notable but not too bad.
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Dana Insider Transactions Over The Last Year
In fact, the recent sale by Executive VP and President of Dana Commercial Vehicle Driveline Tech. Mark Wallace was not their only sale of Dana shares this year. Earlier in the year, they fetched US$13.56 per share in a -US$766.4k sale. That means that even when the share price was below the current price of US$14.08, 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. While insider selling is not a positive sign, we can’t be sure if it does mean insiders think the shares are fully valued, so it’s only a weak sign. We note that the biggest single sale was only 35.8% of Mark Wallace’s holding.
Over the last year we saw more insider selling of Dana shares, than buying. The chart below shows insider transactions (by 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!
Insider Ownership
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. It appears that Dana insiders own 0.8% of the company, worth about US$15m. 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 Does This Data Suggest About Dana Insiders?
Unfortunately, there has been more insider selling of Dana stock, than buying, in the last three months. Despite some insider buying, the longer term picture doesn’t make us feel much more positive. But since Dana is profitable and growing, we’re not too worried by this. Insider ownership isn’t particularly high, so this analysis makes us cautious about the company. So we’d only buy after careful consideration. Of course, the future is what matters most. So if you are interested in Dana, you should check out this free report on analyst forecasts for the company.
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, but not derivative transactions.
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