It is not uncommon to see companies perform well in the years after insiders buy shares. On the other hand, we’d be remiss not to mention that insider sales have been known to precede tough periods for a business. So we’ll take a look at whether insiders have been buying or selling shares in Willis Lease Finance Corporation (NASDAQ:WLFC).
What Is Insider Buying?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock on the market. However, such insiders must disclose their trading activities, and not trade on inside information.
Insider transactions are not the most important thing when it comes to long-term investing. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Columbia University study found that ‘insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers’.
Willis Lease Finance Insider Transactions Over The Last Year
Chairman & CEO Charles Willis made the biggest insider purchase in the last 12 months. That single transaction was for US$4.1m worth of shares at a price of US$34.28 each. That implies that an insider found the current (approximate) price enticing. 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 any event it’s generally a positive if insiders are buying shares at around the current price.
Over the last year, we can see that insiders have bought 121.97k shares worth US$4.2m. On the other hand they divested 22.02k shares, for US$741k. In total, Willis Lease Finance insiders bought more than they sold over the last year. Their average price was about US$34.09. These transactions show that insiders have confidence to invest their own money in the stock, albeit at slightly below the recent price of US$42.29. You can see a visual depiction of insider transactions (by 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!
If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).
Insiders at Willis Lease Finance Have Sold Stock Recently
There was substantially more insider selling, than buying, of Willis Lease Finance shares over the last three months. In that time, insiders dumped US$230k worth of shares. On the flip side, insiders spent US$22k on purchasing shares. Because the selling vastly outweighs the buying, we’d say this is a somewhat bearish sign.
Many investors like to check how much of a company is owned by insiders. I reckon it’s a good sign if insiders own a significant number of shares in the company. It appears that Willis Lease Finance insiders own 15% of the company, worth about US$38m. While this is a strong but not outstanding level of insider ownership, it’s enough to indicate some alignment between management and smaller shareholders.
What Might The Insider Transactions At Willis Lease Finance Tell Us?
The insider sales have outweighed the insider buying, at Willis Lease Finance, in the last three months. But we take heart from prior transactions. It’s good to see insiders are shareholders. So we’re not overly bothered by recent selling. I like to dive deeper into how a company has performed in the past. You can access this interactive graph of past earnings, revenue and cash flow for free .
If you would prefer to check out another company — one with potentially superior financials — then do not miss this free list of interesting companies, that have HIGH return on equity and low debt.
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If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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. Thank you for reading.