Have Flexsteel Industries Insiders Been Selling Stock?

Anyone interested in Flexsteel Industries, Inc. (NASDAQ:FLXS) should probably be aware that the Chief Information & Technology Officer, Michael McClaflin, recently divested US$291k worth of shares in the company, at an average price of US$57.60 each. That sale was 15% of their holding, so it does make us raise an eyebrow.

View our latest analysis for Flexsteel Industries

The Last 12 Months Of Insider Transactions At Flexsteel Industries

Notably, that recent sale by Michael McClaflin is the biggest insider sale of Flexsteel Industries shares that we've seen in the last year. That means that an insider was selling shares at slightly below the current price (US$59.97). 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. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. We note that the biggest single sale was only 15% of Michael McClaflin's holding.

Flexsteel Industries insiders didn't buy any shares over the last year. You can see the insider transactions (by companies and 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!

For those who like to find hidden gems this free list of small cap companies with recent insider purchasing, could be just the ticket.

Insider Ownership Of Flexsteel Industries

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 Flexsteel Industries insiders own 31% of the company, worth about US$98m. 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 Flexsteel Industries Tell Us?

Insiders sold Flexsteel Industries shares recently, but they didn't buy any. Looking to the last twelve months, our data doesn't show any insider buying. Insiders own shares, but we're still pretty cautious, given the history of sales. We're in no rush to buy! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. In terms of investment risks, we've identified 2 warning signs with Flexsteel Industries and understanding these should be part of your investment process.

But note: Flexsteel Industries may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.

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 of direct interests only, but not derivative transactions or indirect interests.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.