Investors who take an interest in Daktronics, Inc. (NASDAQ:DAKT) should definitely note that the Chairman, Reece Kurtenbach, recently paid US$5.29 per share to buy US$132k worth of the stock. Although the purchase only increased their holding by 5.9%, it is still a solid purchase in our view.
View our latest analysis for Daktronics
Daktronics Insider Transactions Over The Last Year
Notably, that recent purchase by Reece Kurtenbach is the biggest insider purchase of Daktronics shares that we’ve seen in the last year. So it’s clear an insider wanted to buy, even at a higher price than the current share price (being US$5.13). While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company’s future. In our view, the price an insider pays for shares is very important. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.
Over the last year, we can see that insiders have bought 36.67k shares worth US$203k. On the other hand they divested 13130 shares, for US$79k. In total, Daktronics insiders bought more than they sold over the last year. The chart below shows insider transactions (by individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Daktronics is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Does Daktronics Boast High 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. I reckon it’s a good sign if insiders own a significant number of shares in the company. It appears that Daktronics insiders own 11% of the company, worth about US$26m. 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 Does This Data Suggest About Daktronics Insiders?
It is good to see the recent insider purchase. And the longer term insider transactions also give us confidence. But we don’t feel the same about the fact the company is making losses. When combined with notable insider ownership, these factors suggest Daktronics insiders are well aligned, and that they may think the share price is too low. 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. While conducting our analysis, we found that Daktronics has 1 warning sign and it would be unwise to ignore it.
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.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.