Keep An Eye On iRobot As Insider Stock Selling Hits US$2.8m

Despite the fact that iRobot Corporation (NASDAQ:IRBT) stock rose 13% last week, insiders who sold US$2.8m worth of stock in the previous 12 months are likely to be better off. Holding on to stock would have meant their investment would be worth less now than it was at the time of sale. Thus selling at an average price of US$14.16, which is higher than the current price, may have been the best decision.

While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.

See our latest analysis for iRobot

The Last 12 Months Of Insider Transactions At iRobot

In the last twelve months, the biggest single sale by an insider was when the insider, Colin Angle, sold US$2.1m worth of shares at a price of US$11.46 per share. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. It's of some comfort that this sale was conducted at a price well above the current share price, which is US$8.05. So it may not tell us anything about how insiders feel about the current share price.

All up, insiders sold more shares in iRobot than they bought, over the last year. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

If you are like me, then you will not want to miss this free list of small cap stocks that are not only being bought by insiders but also have attractive valuations.

Does iRobot Boast High Insider Ownership?

Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. From looking at our data, insiders own US$4.0m worth of iRobot stock, about 1.6% of the company. We consider this fairly low insider ownership.

What Might The Insider Transactions At iRobot Tell Us?

There haven't been any insider transactions in the last three months -- that doesn't mean much. The insider transactions at iRobot are not inspiring us to buy. We also note that, as far as we can see, insider ownership is fairly low, compared to other companies. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. For example - iRobot has 3 warning signs we think you should be aware of.

But note: iRobot 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.