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Possible bearish signals as EMCOR Group, Inc. (NYSE:EME) insiders disposed of US$2.4m worth of stock
In the last year, many EMCOR Group, Inc. (NYSE:EME) insiders sold a substantial stake in the company which may have sparked shareholders' attention. When evaluating insider transactions, knowing whether insiders are buying versus if they selling is usually more beneficial, as the latter can be open to many interpretations. However, if numerous insiders are selling, shareholders should investigate more.
While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.
See our latest analysis for EMCOR Group
The Last 12 Months Of Insider Transactions At EMCOR Group
The Executive Vice President of Shared Services, R. Matz, made the biggest insider sale in the last 12 months. That single transaction was for US$1.5m worth of shares at a price of US$152 each. So we know that an insider sold shares at around the present share price of US$150. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. Given that the sale took place at around current prices, it makes us a little cautious but is hardly a major concern.
In the last year EMCOR Group insiders didn't buy any company stock. 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!
If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: insiders have been buying them).
EMCOR Group Insiders Are Selling The Stock
The last quarter saw substantial insider selling of EMCOR Group shares. In total, Executive Vice President of Shared Services R. Matz sold US$1.5m worth of shares in that time, and we didn't record any purchases whatsoever. Overall this makes us a bit cautious, but it's not the be all and end all.
Insider Ownership
For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. EMCOR Group insiders own about US$96m worth of shares. That equates to 1.3% 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.
So What Does This Data Suggest About EMCOR Group Insiders?
An insider hasn't bought EMCOR Group stock in the last three months, but there was some selling. And even if we look at the last year, we didn't see any purchases. On the plus side, EMCOR Group makes money, and is growing profits. Insiders own shares, but we're still pretty cautious, given the history of sales. We're in no rush to buy! 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. To assist with this, we've discovered 1 warning sign that you should run your eye over to get a better picture of EMCOR Group.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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.
What are the risks and opportunities for EMCOR Group?
EMCOR Group, Inc. provides electrical and mechanical construction, and facilities services primarily in the United States and the United Kingdom.
Rewards
Trading at 8% below our estimate of its fair value
Earnings are forecast to grow 12.13% per year
Earnings have grown 8.7% per year over the past 5 years
Risks
No risks detected for EME from our risks checks.
Further research on
EMCOR Group
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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.
About NYSE:EME
EMCOR Group
EMCOR Group, Inc. provides electrical and mechanical construction, and facilities services primarily in the United States and the United Kingdom.
Flawless balance sheet and good value.
