Smart Sand Reaches US$87m Market Cap Benefiting Insider Stock Buying

Smart Sand, Inc. (NASDAQ:SND) insiders who purchased shares in the last 12 months were richly rewarded last week. The stock climbed by 12% resulting in a US$9.6m addition to the company’s market value. Put another way, the original US$170.2k acquisition is now worth US$188.7k.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

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Smart Sand Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when CEO & Director Charles Young bought US$78k worth of shares at a price of US$1.92 per share. That implies that an insider found the current price of US$2.12 per share to be enticing. That means they have been optimistic about the company in the past, though they may have changed their mind. We do always like to see insider buying, but it is worth noting if those purchases were made at well below today's share price, as the discount to value may have narrowed with the rising price. Happily, the Smart Sand insider decided to buy shares at close to current prices. Charles Young was the only individual insider to buy during the last year.

Charles Young bought 89.03k shares over the last 12 months at an average price of US$1.91. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

See our latest analysis for Smart Sand

There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).

Insiders At Smart Sand Have Bought Stock Recently

There has been significantly more insider buying, than selling, at Smart Sand, over the last three months. We can see that CEO & Director Charles Young paid US$170k for shares in the company. But we did see Vice President of Accounting & Controller Christopher Green sell shares worth US$22k. Insiders have spent more buying shares than they have selling, so on balance we think they are are probably optimistic.

Insider Ownership Of Smart Sand

For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. It appears that Smart Sand insiders own 17% of the company, worth about US$15m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Does This Data Suggest About Smart Sand Insiders?

It's certainly positive to see the recent insider purchase. And an analysis of the transactions over the last year also gives us confidence. When combined with notable insider ownership, these factors suggest Smart Sand insiders are well aligned, and that they may think the share price is too low. 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. Be aware that Smart Sand is showing 3 warning signs in our investment analysis, and 1 of those is concerning...

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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 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.