Should You Be Worried About Insider Transactions At IRadimed Corporation (NASDAQ:IRMD)?

We’ve lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So shareholders might well want to know whether insiders have been buying or selling shares in IRadimed Corporation (NASDAQ:IRMD).

What Is Insider Selling?

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.

Insider transactions are not the most important thing when it comes to long-term investing. But equally, we would consider it foolish to ignore insider transactions altogether. 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’.

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Check out our latest analysis for IRadimed

The Last 12 Months Of Insider Transactions At IRadimed

In the last twelve months, the biggest single sale by an insider was when the , Francis Casey, sold US$1.6m worth of shares at a price of US$30.51 per share. We generally don’t like to see insider selling, but the lower the sale price, the more it concerns us. The good news is that this large sale was at well above current price of US$21.79. So it is hard to draw any strong conclusion from it.

Over the last year, we note insiders sold 139k shares worth US$3.5m. Insiders in IRadimed didn’t buy any shares in the last year. The chart below shows insider transactions (by individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

NasdaqCM:IRMD Recent Insider Trading, May 26th 2019
NasdaqCM:IRMD Recent Insider Trading, May 26th 2019

I will like IRadimed better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

IRadimed Insiders Are Selling The Stock

We have seen a bit of insider selling at IRadimed, over the last three months. Steve Nardi sold just US$37k worth of shares in that time. It’s not great to see insider selling, nor the lack of recent buyers. But the amount sold isn’t enough for us to put any weight on it.

Insider Ownership

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. IRadimed insiders own about US$131m worth of shares (which is 54% 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 IRadimed Tell Us?

Our data shows a little more insider selling, but no insider buying, in the last three months. But the sales were small, so we’re not concerned. It’s great to see high levels of insider ownership, but looking back at the last year, we don’t gain confidence from the IRadimed insiders selling. Of course, the future is what matters most. So if you are interested in IRadimed, you should check out this free report on analyst forecasts for the company.

If you would prefer to check out another company — one with potentially superior financials — then do not miss this free list of interesting companies, that have HIGH return on equity and low debt.

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If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.