Insider Sellers Might Regret Selling FTC Solar Shares at a Lower Price Than Current Market Value

FTC Solar, Inc.'s (NASDAQ:FTCI) value has fallen 10% in the last week, but insiders who sold US$1.6m worth of stock over the last year have had less success. Given that the average selling price of US$2.60 is still lower than the current share price, insiders would probably have been better off keeping their shares.

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.

See our latest analysis for FTC Solar

The Last 12 Months Of Insider Transactions At FTC Solar

The Chief Commercial Officer, Patrick Cook, made the biggest insider sale in the last 12 months. That single transaction was for US$537k worth of shares at a price of US$2.34 each. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. The silver lining is that this sell-down took place above the latest price (US$0.49). So it is hard to draw any strong conclusion from it.

In the last twelve months insiders purchased 1.18m shares for US$1.5m. But they sold 624.63k shares for US$1.6m. All up, insiders sold more shares in FTC Solar than they bought, over the last year. The sellers received a price of around US$2.60, on average. Insider selling doesn't make us excited to buy. But the selling was at much higher prices than the current share price (US$0.49), so it probably doesn't tell us a lot about the value on offer today. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

Have FTC Solar Insiders Traded Recently?

We saw insider selling worth US$14k in the last three months. But that was only a smidgen more than the US$10k worth of buying. Ultimately the overall selling isn't enough to tell us much.

Does FTC Solar 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. It appears that FTC Solar insiders own 33% of the company, worth about US$21m. 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 FTC Solar Insiders?

Insider selling has just outweighed insider buying in the last three months. But the difference isn't enough to have us worried. Recent insider selling makes us a little nervous, in light of the broader picture of FTC Solar insider transactions. The modest level of insider ownership is, at least, some comfort. 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. For example, FTC Solar has 4 warning signs (and 1 which is significant) we think you should know about.

Of course FTC Solar 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 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.