We'd be surprised if Ducommun Incorporated (NYSE:DCO) shareholders haven't noticed that the VP, CFO, Christopher Wampler, recently sold US$131k worth of stock at US$54.77 per share. That sale was 10% of their holding, so it does make us raise an eyebrow.
The Last 12 Months Of Insider Transactions At Ducommun
In fact, the recent sale by VP, CFO Christopher Wampler was not their only sale of Ducommun shares this year. They previously made an even bigger sale of -US$160k worth of shares at a price of US$39.94 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of US$54.76. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. It is worth noting that this sale was only 20% of Christopher Wampler's holding.
Ducommun insiders didn't buy any shares over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
I will like Ducommun better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
Does Ducommun 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. We usually like to see fairly high levels of insider ownership. It appears that Ducommun insiders own 8.9% of the company, worth about US$59m. 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 Ducommun Tell Us?
An insider sold Ducommun shares recently, but they didn't buy any. And there weren't any purchases to give us comfort, over the last year. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. So we'd only buy after careful consideration. While we like knowing 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. Case in point: We've spotted 1 warning sign for Ducommun you should be aware of.
Of course Ducommun 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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