Stock Analysis

Insiders who bought this year lost US$28k as FreightCar America, Inc. (NASDAQ:RAIL) sheds US$6.7m in value

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Insiders who bought US$402k worth of FreightCar America, Inc.'s (NASDAQ:RAIL) stock at an average buy price of US$3.66 over the last year may be disappointed by the recent 10% decrease in the stock. Insiders purchase with the hope of seeing their investments increase in value over time. However, due to recent losses, their initial investment is now only worth US$373k, which is not great.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

View our latest analysis for FreightCar America

The Last 12 Months Of Insider Transactions At FreightCar America

The insider Alejandro Benavides made the biggest insider purchase in the last 12 months. That single transaction was for US$191k worth of shares at a price of US$3.70 each. That means that even when the share price was higher than US$3.40 (the recent price), an insider wanted to purchase shares. Their view may have changed since then, but at least it shows they felt optimistic at the time. We always take careful note of the price insiders pay when purchasing shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.

In the last twelve months FreightCar America 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!

NasdaqGS:RAIL Insider Trading Volume March 15th 2023

FreightCar America is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Does FreightCar America Boast High Insider Ownership?

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. FreightCar America insiders own about US$13m worth of shares. That equates to 21% of the company. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

What Might The Insider Transactions At FreightCar America Tell Us?

There haven't been any insider transactions in the last three months -- that doesn't mean much. But insiders have shown more of an appetite for the stock, over the last year. Insiders own shares in FreightCar America and we see no evidence to suggest they are worried about the future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing FreightCar America. For instance, we've identified 4 warning signs for FreightCar America (2 are a bit unpleasant) you should be aware of.

Of course FreightCar America 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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