Have Insiders Been Selling MBIA Inc. (NYSE:MBI) Shares This Year?

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 before you buy or sell MBIA Inc. (NYSE:MBI), you may well want to know whether insiders have been buying or selling.

What Is Insider Selling?

It’s quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, rules govern insider transactions, and certain disclosures are required.

We don’t think shareholders should simply follow insider transactions. But it is perfectly logical to keep tabs on what insiders are doing. For example, a Harvard University study found that ‘insider purchases earn abnormal returns of more than 6% per year.

See our latest analysis for MBIA

MBIA Insider Transactions Over The Last Year

The Independent Director, Theodore Shasta, made the biggest insider sale in the last 12 months. That single transaction was for US$272k worth of shares at a price of US$9.15 each. So what is clear is that an insider saw fit to sell at around the current price of US$8.37. While insider selling is a negative, to us, it is more negative if the shares are sold 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.

Insiders in MBIA didn’t buy any shares in the last year. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

NYSE:MBI Recent Insider Trading, February 28th 2020
NYSE:MBI Recent Insider Trading, February 28th 2020

For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Insider Ownership of MBIA

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Insiders own 7.6% of MBIA shares, worth about US$52m. 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 MBIA Insiders?

It doesn’t really mean much that no insider has traded MBIA shares in the last quarter. Our analysis of MBIA insider transactions leaves us cautious. But we do like the fact that insiders own a fair chunk of the company. If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

Of course MBIA 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, but not derivative transactions.

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.

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