Have Insiders Sold Farmer Bros. Co. (NASDAQ:FARM) Shares Recently?

Some Farmer Bros. Co. (NASDAQ:FARM) shareholders may be a little concerned to see that insider Carol Waite recently sold a substantial US$1.2m worth of stock at a price of US$8.70 per share. That's a big disposal, and it decreased their holding size by 13%, which is notable but not too bad.

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The Last 12 Months Of Insider Transactions At Farmer Bros

In fact, the recent sale by Carol Waite was the biggest sale of Farmer Bros shares made by an insider individual in the last twelve months, according to our records. That means that an insider was selling shares at slightly below the current price (US$10.03). We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. However, while insider selling is sometimes discouraging, it's only a weak signal. It is worth noting that this sale was only 13% of Carol Waite's holding.

Carol Waite divested 177.93k shares over the last 12 months at an average price of US$8.08. 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!

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

Insider Ownership of Farmer Bros

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. Insiders own 8.3% of Farmer Bros shares, worth about US$14m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Does This Data Suggest About Farmer Bros Insiders?

An insider sold Farmer Bros shares recently, but they didn't buy any. Looking to the last twelve months, our data doesn't show any insider buying. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. We're in no rush to buy! 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. To help with this, we've discovered 5 warning signs (1 can't be ignored!) that you ought to be aware of before buying any shares in Farmer Bros.

But note: Farmer Bros 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, but not derivative transactions.

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This article by Simply Wall St is general in nature. 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.
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