Insider Sellers Might Regret Selling Nine Energy Service Shares at a Lower Price Than Current Market Value

Despite the fact that Nine Energy Service, Inc.'s (NYSE:NINE) value has dropped 12% in the last week insiders who sold US$3.6m worth of stock in the past 12 months have had less success. Insiders might have been better off holding onto their shares, given that the average selling price of US$4.81 is still below the current share price.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

Check out our latest analysis for Nine Energy Service

The Last 12 Months Of Insider Transactions At Nine Energy Service

In the last twelve months, the biggest single sale by an insider was when the insider, Warren Frazier, sold US$1.1m worth of shares at a price of US$4.13 per share. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. The silver lining is that this sell-down took place above the latest price (US$1.98). So it may not tell us anything about how insiders feel about the current share price.

In total, Nine Energy Service insiders sold more than they bought over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

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Insider Ownership Of Nine Energy Service

For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. Nine Energy Service insiders own about US$13m worth of shares. That equates to 19% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

What Might The Insider Transactions At Nine Energy Service Tell Us?

There haven't been any insider transactions in the last three months -- that doesn't mean much. Still, the insider transactions at Nine Energy Service in the last 12 months are not very heartening. But it's good to see that insiders own shares in the company. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. At Simply Wall St, we've found that Nine Energy Service has 3 warning signs (1 shouldn't be ignored!) that deserve your attention before going any further with your analysis.

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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.