We often see insiders buying up shares in companies that perform well over the long term. On the other hand, we'd be remiss not to mention that insider sales have been known to precede tough periods for a business. So we'll take a look at whether insiders have been buying or selling shares in Harsco Corporation (NYSE:HSC).
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'.
See our latest analysis for Harsco
The Last 12 Months Of Insider Transactions At Harsco
Over the last year, we can see that the biggest insider sale was by Senior VP & Group President of Harsco Industrial Scott Gerson for US$513k worth of shares, at about US$27.31 per share. While the sale doesn't make us feel confident, we do note it was conducted at a price well above the current share price, which is US$21.40. So it may not shed much light on insider confidence at current levels.
Over the last year, we note insiders sold 45.31k shares worth US$1.1m. All up, insiders sold more shares in Harsco than they bought, over the last year. The average sell price was around US$24.79. It's not ideal to see that insiders have sold at around the current price of US$21.40. While some insiders have decided to take some money off the table, we wouldn't put too much weight on this fact. The chart below shows insider transactions (by individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
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Insiders at Harsco Have Sold Stock Recently
Over the last three months, we've seen significant insider selling at Harsco. Specifically, Scott Gerson ditched US$229k 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.
Does Harsco Boast High Insider Ownership?
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. I reckon it's a good sign if insiders own a significant number of shares in the company. It appears that Harsco insiders own 1.1% of the company, worth about US$18m. 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 Harsco Insider Transactions Indicate?
An insider hasn't bought Harsco stock in the last three months, but there was some selling. And even if we look to the last year, we didn't see any purchases. But since Harsco is profitable and growing, we're not too worried by this. Insiders own shares, but we're still pretty cautious, given the history of sales. So we'd only buy after careful consideration. Therefore, you should should definitely take a look at this FREEreport showing analyst forecasts for Harsco.
Of course Harsco may not be the best stock to buy. So you may wish to see this freecollection of high quality companies.
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