Don't Ignore The Insider Selling In Avanos Medical

We'd be surprised if Avanos Medical, Inc. (NYSE:AVNS) shareholders haven't noticed that the Senior VP & Chief Commercial Officer, Kerr Holbrook, recently sold US$107k worth of stock at US$15.25 per share. On the bright side, that sale was only 8.4% of their holding, so we doubt it's very meaningful, on its own.

View our latest analysis for Avanos Medical

The Last 12 Months Of Insider Transactions At Avanos Medical

The Interim CEO, Michael Greiner, made the biggest insider sale in the last 12 months. That single transaction was for US$153k worth of shares at a price of US$19.16 each. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The good news is that this large sale was at well above current price of US$14.75. So it is hard to draw any strong conclusion from it.

In the last year Avanos Medical insiders didn't buy any company stock. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

If you are like me, then you will not want to miss this free list of small cap stocks that are not only being bought by insiders but also have attractive valuations.

Does Avanos Medical Boast High 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. Avanos Medical insiders own about US$11m worth of shares. That equates to 1.6% of the company. 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 Avanos Medical Insiders?

An insider sold Avanos Medical shares recently, but they didn't buy any. And there weren't any purchases to give us comfort, over the last year. While insiders do own shares, they don't own a heap, and they have been selling. We'd practice some caution before buying! 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 Avanos Medical is showing 2 warning signs in our investment analysis, and 1 of those shouldn't be ignored...

But note: Avanos Medical 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 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.