It is not uncommon to see companies perform well in the years after insiders buy shares. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So shareholders might well want to know whether insiders have been buying or selling shares in SiteOne Landscape Supply, Inc. (NYSE:SITE).
What Is Insider Buying?
It’s quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, rules govern insider transactions, and certain disclosures are required.
We don’t think shareholders should simply follow insider transactions. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Harvard University study found that ‘insider purchases earn abnormal returns of more than 6% per year.’
SiteOne Landscape Supply Insider Transactions Over The Last Year
Pascal Convers made the biggest insider sale in the last 12 months. That single transaction was for US$5.9m worth of shares at a price of US$91.73 each. That is hardly a positive sign, even though it took place above the latest price (US$56.18). So it is hard to draw any strong conclusion from it.
Over the last year, we note insiders sold 107.23k shares worth US$9.8m. Over the last year we saw more insider selling of SiteOne Landscape Supply shares, than buying. The average sell price was around US$91.55. We are not joyful about insider selling. However, we do note that the average sale price was significantly higher than the current share price (which is US$56.18). You can see the insider transactions (by individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!
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Insider Ownership of SiteOne Landscape Supply
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. Insiders own 1.2% of SiteOne Landscape Supply shares, worth about US$27m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
So What Does This Data Suggest About SiteOne Landscape Supply Insiders?
It doesn’t really mean much that no insider has traded SiteOne Landscape Supply shares in the last quarter. Still, the insider transactions at SiteOne Landscape Supply in the last 12 months are not very heartening. But we do like the fact that insiders own a fair chunk of the company. Of course, the future is what matters most. So if you are interested in SiteOne Landscape Supply, you should check out this free report on analyst forecasts for the company.
Of course SiteOne Landscape Supply may not be the best stock to buy. So you may wish to see this free collection of high quality companies.
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If you spot an error that warrants correction, please contact the editor at email@example.com. 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.