Don't Ignore The Insider Selling In UFP Technologies

Some UFP Technologies, Inc. (NASDAQ:UFPT) shareholders may be a little concerned to see that the CEO & Chairman, R. Bailly, recently sold a substantial US$8.8m worth of stock at a price of US$348 per share. That sale reduced their total holding by 14% which is hardly insignificant, but far from the worst we've seen.

View our latest analysis for UFP Technologies

The Last 12 Months Of Insider Transactions At UFP Technologies

In fact, the recent sale by CEO & Chairman R. Bailly was not their only sale of UFP Technologies shares this year. Earlier in the year, they fetched US$325 per share in a -US$14m sale. That means that an insider was selling shares at around the current price of US$309. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. Given that the sale took place at around current prices, it makes us a little cautious but is hardly a major concern.

UFP Technologies insiders didn't buy any shares over the last year. 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 like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: Most of them are flying under the radar).

Insider Ownership

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. It appears that UFP Technologies insiders own 4.0% of the company, worth about US$96m. 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 Do The UFP Technologies Insider Transactions Indicate?

Insiders haven't bought UFP Technologies stock in the last three months, but there was some selling. Looking to the last twelve months, our data doesn't show any insider buying. But it is good to see that UFP Technologies is growing earnings. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. We're in no rush to buy! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. To assist with this, we've discovered 2 warning signs that you should run your eye over to get a better picture of UFP Technologies.

Of course UFP Technologies 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 of direct interests only, but not derivative transactions or indirect interests.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.