Bullish Churchill Downs Insiders Loaded Up On US$1.30m Of Stock

Over the last year, a good number of insiders have significantly increased their holdings in Churchill Downs Incorporated (NASDAQ:CHDN). This is encouraging because it indicates that insiders are more optimistic about the company's prospects.

Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.

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Churchill Downs Insider Transactions Over The Last Year

In fact, the recent purchase by Douglas Grissom was the biggest purchase of Churchill Downs shares made by an insider individual in the last twelve months, according to our records. So it's clear an insider wanted to buy, at around the current price, which is US$95.04. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. The good news for Churchill Downs share holders is that insiders were buying at near the current price.

In the last twelve months Churchill Downs insiders were buying shares, but not selling. 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!

See our latest analysis for Churchill Downs

Churchill Downs is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.

Insiders At Churchill Downs Have Bought Stock Recently

Over the last three months, we've seen significant insider buying at Churchill Downs. In total, insiders bought US$1.3m worth of shares in that time, and we didn't record any sales whatsoever. This could be interpreted as suggesting a positive outlook.

Does Churchill Downs 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. Churchill Downs insiders own 3.9% of the company, currently worth about US$270m based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Does This Data Suggest About Churchill Downs Insiders?

It is good to see recent purchasing. We also take confidence from the longer term picture of insider transactions. When combined with notable insider ownership, these factors suggest Churchill Downs insiders are well aligned, and quite possibly think the share price is too low. Looks promising! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Churchill Downs. While conducting our analysis, we found that Churchill Downs has 1 warning sign and it would be unwise to ignore this.

But note: Churchill Downs 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.