SmileDirectClub, Inc. (NASDAQ:SDC) shareholders (or potential shareholders) will be happy to see that the CEO & Chairman, David Katzman, recently bought a whopping US$10m worth of stock, at a price of US$8.07. That purchase boosted their holding by 3,454%, which makes us wonder if the move was inspired by quietly confident deeply-felt optimism.
View our latest analysis for SmileDirectClub
SmileDirectClub Insider Transactions Over The Last Year
Notably, that recent purchase by David Katzman is the biggest insider purchase of SmileDirectClub shares that we’ve seen in the last year. That implies that an insider found the current price of US$9.80 per share to be enticing. 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. In this case we’re pleased to report that the insider purchases were made at close to current prices.
In the last twelve months SmileDirectClub insiders were buying shares, but not selling. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
SmileDirectClub is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Does SmileDirectClub Boast High Insider Ownership?
Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. From looking at our data, insiders own US$4.1m worth of SmileDirectClub stock, about 0.4% of the company. We prefer to see high levels of insider ownership.
So What Do The SmileDirectClub Insider Transactions Indicate?
It’s certainly positive to see the recent insider purchases. And the longer term insider transactions also give us confidence. However, we note that the company didn’t make a profit over the last twelve months, which makes us cautious. On this analysis the only slight negative we see is the fairly low (overall) insider ownership; their transactions suggest that they are quite positive on SmileDirectClub stock. So these insider transactions can help us build a thesis about the stock, but it’s also worthwhile knowing the risks facing this company. While conducting our analysis, we found that SmileDirectClub has 2 warning signs and it would be unwise to ignore these.
Of course SmileDirectClub 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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