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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 Wilhelmina International, Inc. (NASDAQ:WHLM).
What Is Insider Selling?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. 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 Columbia University study found that ‘insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers’.
Wilhelmina International Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider sale was by the Independent Director, Horst-Dieter Esch, for US$350k worth of shares, at about US$7.00 per share. So we know that an insider sold shares at around the present share price of US$5.95. We generally don’t like to see insider selling, but the lower the sale price, the more it concerns us. We note that this sale took place at around the current price, so it isn’t a major concern, though it’s hardly a good sign. The only individual insider seller over the last year was Horst-Dieter Esch.
You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.
Insider Ownership of Wilhelmina International
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it’s a good sign if insiders own a significant number of shares in the company. It appears that Wilhelmina International insiders own 36% of the company, worth about US$11m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
What Might The Insider Transactions At Wilhelmina International Tell Us?
The fact that there have been no Wilhelmina International insider transactions recently certainly doesn’t bother us. Our analysis of Wilhelmina International insider transactions leaves us cautious. But it’s good to see that insiders own shares in the company. Along with insider transactions, I recommend checking if Wilhelmina International is growing revenue. This free chart of historic revenue and earnings should make that easy.
Of course Wilhelmina International may not be the best stock to buy. So you may wish to see this free collection of high quality companies.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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.