Bullish Motorcar Parts of America Insiders Loaded Up On US$1.45m Of Stock

In the last year, multiple insiders have substantially increased their holdings of Motorcar Parts of America, Inc. (NASDAQ:MPAA) stock, indicating that insiders' optimism about the company's prospects has increased.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.

Check out our latest analysis for Motorcar Parts of America

The Last 12 Months Of Insider Transactions At Motorcar Parts of America

In the last twelve months, the biggest single purchase by an insider was when Director Douglas Trussler bought US$874k worth of shares at a price of US$5.86 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of US$6.59. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

Over the last year, we can see that insiders have bought 233.50k shares worth US$1.4m. But they sold 7.17k shares for US$63k. In total, Motorcar Parts of America insiders bought more than they sold over the last year. 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!

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.

Does Motorcar Parts of America 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. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Our data indicates that Motorcar Parts of America insiders own about US$6.7m worth of shares (which is 5.5% of the company). Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!

So What Do The Motorcar Parts of America Insider Transactions Indicate?

There haven't been any insider transactions in the last three months -- that doesn't mean much. On a brighter note, the transactions over the last year are encouraging. The transactions are fine but it'd be more encouraging if Motorcar Parts of America insiders bought more shares in the company. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. In terms of investment risks, we've identified 2 warning signs with Motorcar Parts of America and understanding them should be part of your investment process.

But note: Motorcar Parts of America 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 of direct interests only, but not derivative transactions or indirect interests.

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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.