How Much Are DMC Global Inc. (NASDAQ:BOOM) Insiders Taking Off The Table?

By
Simply Wall St
Published
May 27, 2021
NasdaqGS:BOOM
Source: Shutterstock

It is not uncommon to see companies perform well in the years after insiders buy shares. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So we'll take a look at whether insiders have been buying or selling shares in DMC Global Inc. (NASDAQ:BOOM).

Do Insider Transactions Matter?

It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, such insiders must disclose their trading activities, and not trade on inside information.

We don't think shareholders should simply follow insider transactions. But it is perfectly logical to keep tabs on what insiders are doing. For example, a Columbia University study found that 'insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers'.

View our latest analysis for DMC Global

DMC Global Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the insider, Yvon Cariou, for US$1.9m worth of shares, at about US$64.10 per share. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. It's of some comfort that this sale was conducted at a price well above the current share price, which is US$52.97. So it may not tell us anything about how insiders feel about the current share price.

DMC Global insiders didn't buy any shares over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

insider-trading-volume
NasdaqGS:BOOM Insider Trading Volume May 28th 2021

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

Insiders at DMC Global Have Sold Stock Recently

The last quarter saw substantial insider selling of DMC Global shares. Specifically, insiders ditched US$344k worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.

Insider Ownership of DMC Global

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. Insiders own 1.7% of DMC Global shares, worth about US$17m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Does This Data Suggest About DMC Global Insiders?

Insiders sold DMC Global shares recently, but they didn't buy any. And even if we look at the last year, we didn't see any purchases. While insiders do own shares, they don't own a heap, and they have been selling. We'd practice some caution before buying! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing DMC Global. For example - DMC Global has 3 warning signs we think you should be aware of.

Of course DMC Global 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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