It is not uncommon to see companies perform well in the years after insiders buy shares. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So we’ll take a look at whether insiders have been buying or selling shares in Vectrus, Inc. (NYSE:VEC).
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, 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 Harvard University study found that ‘insider purchases earn abnormal returns of more than 6% per year.’
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Vectrus Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when Director Phillip Widman bought US$312k worth of shares at a price of US$31.21 per share. So it’s clear an insider wanted to buy, even at a higher price. Their view may have changed since then, but at least it shows they felt optimistic at the time. That purchase may suggest an expectation of positive returns over the long term.
Happily, we note that in the last year insiders paid US$905k for 31.98k shares. But insiders sold 1.38k shares worth US$50k. In the last twelve months there was more buying than selling by Vectrus insiders. The average buy price was around US$28.31. These transactions suggest that insiders have considered the current price of US$24.10 attractive. You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Vectrus is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Insiders at Vectrus Have Bought Stock Recently
It’s good to see that Vectrus insiders have made notable investments in the company’s shares. In total, insiders bought US$271k worth of shares in that time, and we didn’t record any sales whatsoever. This makes one think the business has some good points.
Does Vectrus Boast High Insider Ownership?
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. I reckon it’s a good sign if insiders own a significant number of shares in the company. Insiders own 2.2% of Vectrus shares, worth about US$5.9m, according to our data. Whilst better than nothing, we’re not overly impressed by these holdings.
What Might The Insider Transactions At Vectrus Tell Us?
It’s certainly positive to see the recent insider purchases. And an analysis of the transactions over the last year also gives us confidence. While the overall levels of insider ownership are below what we’d like to see, the history of transactions imply that Vectrus insiders are reasonably well aligned, and optimistic for the future. Of course, the future is what matters most. So if you are interested in Vectrus, you should check out this free report on analyst forecasts for the company.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at email@example.com.