We often see insiders buying up shares in companies that perform well over the long term. 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 before you buy or sell GoPro Inc (NASDAQ:GPRO), you may well want to know whether insiders have been buying or selling.
Do Insider Transactions Matter?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock on the market. However, such insiders must disclose their trading activities, and not trade on inside information.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But it is perfectly logical to keep tabs on what insiders are doing. As Peter Lynch said, ‘insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.’
The Last 12 Months Of Insider Transactions At GoPro
Sharon Zezima made the biggest insider sale in the last 12 months. That single transaction was for US$84k worth of shares at a price of US$5.60 each. So what is clear is that an insider saw fit to sell at around the current price of US$5.03. They might be selling for a variety of reasons, but it’s hard to argue this is a bullish sign. Arguably, insider selling at current prices should give us reason to reflect on whether the stock is fully valued at the moment.
We note that in the last year insiders divested 19.15k shares for a total of US$107k. In total, GoPro insiders sold more than they bought over the last year. They sold for an average price of about US$5.56. We don’t gain much confidence from insider selling near the recent share price of US$5.03. Since insiders sell for many reasons, we wouldn’t put too much weight on it. You can see the insider transactions 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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Insiders at GoPro Have Sold Stock Recently
Over the last three months, we’ve seen a bit of insider selling at GoPro. Director Tyrone Ahmad-Taylor sold just US$23k worth of shares in that time. It’s not great to see insider selling, nor the lack of recent buyers. But the volume sold is so low that it really doesn’t bother us.
Insider Ownership of GoPro
For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. It’s great to see that GoPro insiders own 26% of the company, worth about US$190m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
So What Does This Data Suggest About GoPro Insiders?
We note a that there’s been a little more insider selling than buying, recently. But the difference is small, and thus, not concerning. Recent sales exacerbate our caution arising from analysis of GoPro insider transactions. But it’s good to see that insiders own shares in the company. If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.
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 firstname.lastname@example.org.