As Credit Acceptance Corporation's (NASDAQ:CACC)) market cap dropped by US$232m, insiders who sold US$30m worth of stock were able to offset their losses

Insiders seem to have made the most of their holdings by selling US$30m worth of Credit Acceptance Corporation (NASDAQ:CACC) stock at an average sell price of US$490 during the past year. The company's market worth decreased by US$232m over the past week after the stock price dropped 3.9%, although insiders were able to minimize their losses

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.

Check out our latest analysis for Credit Acceptance

The Last 12 Months Of Insider Transactions At Credit Acceptance

The insider, Thomas Smith, made the biggest insider sale in the last 12 months. That single transaction was for US$19m worth of shares at a price of US$483 each. So what is clear is that an insider saw fit to sell at around the current price of US$450. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. In this case, the big sale took place at around the current price, so it's not too bad (but it's still not a positive). Thomas Smith was the only individual insider to sell shares in the last twelve months.

Thomas Smith divested 61.10k shares over the last 12 months at an average price of US$490. The chart below shows insider transactions (by companies and 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 Credit Acceptance Have Sold Stock Recently

Over the last three months, we've seen significant insider selling at Credit Acceptance. Specifically, insider Thomas Smith ditched US$522k 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 Credit Acceptance Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Credit Acceptance insiders own about US$691m worth of shares (which is 12% of the company). I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

What Might The Insider Transactions At Credit Acceptance Tell Us?

An insider sold Credit Acceptance shares recently, but they didn't buy any. Looking to the last twelve months, our data doesn't show any insider buying. It is good to see high insider ownership, but the insider selling leaves us cautious. While we like knowing 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, Credit Acceptance has 3 warning signs (and 1 which can't be ignored) we think you should know about.

Of course Credit Acceptance may not be the best stock to buy. So you may wish to see this free collection of high quality companies.

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, but not derivative transactions.

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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.