Should You Review Recent Insider Transactions At Orion Group Holdings, Inc. (NYSE:ORN)?

By
Simply Wall St
Published
May 24, 2021
NYSE:ORN
Source: Shutterstock

We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sell Orion Group Holdings, Inc. (NYSE:ORN), you may well want to know whether insiders have been buying or selling.

What Is Insider Buying?

It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, rules govern insider transactions, and certain disclosures are required.

We don't think shareholders should simply follow insider transactions. But it is perfectly logical to keep tabs on what insiders are doing. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year'.

See our latest analysis for Orion Group Holdings

The Last 12 Months Of Insider Transactions At Orion Group Holdings

The Independent Chairman of the Board, Austin Shanfelter, made the biggest insider sale in the last 12 months. That single transaction was for US$198k worth of shares at a price of US$3.92 each. That means that an insider was selling shares at slightly below the current price (US$6.27). As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. We note that the biggest single sale was only 28% of Austin Shanfelter's holding. The only individual insider seller over the last year was Austin Shanfelter.

You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

insider-trading-volume
NYSE:ORN Insider Trading Volume May 25th 2021

For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Insider Ownership of Orion Group Holdings

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. Orion Group Holdings insiders own about US$13m worth of shares. That equates to 7.1% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Do The Orion Group Holdings Insider Transactions Indicate?

The fact that there have been no Orion Group Holdings insider transactions recently certainly doesn't bother us. Our analysis of Orion Group Holdings insider transactions leaves us cautious. But we do like the fact that insiders own a fair chunk of the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Orion Group Holdings. At Simply Wall St, we found 2 warning signs for Orion Group Holdings that deserve your attention before buying any shares.

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.

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