Old Republic International Corporation (NYSE:ORI) Insiders Have Been Selling

It is not uncommon to see companies perform well in the years after insiders buy shares. 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 Old Republic International Corporation (NYSE:ORI).

What Is Insider Buying?

Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock on the market. However, rules govern insider transactions, and certain disclosures are required.

We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Harvard University study found that ‘insider purchases earn abnormal returns of more than 6% per year.’

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The Last 12 Months Of Insider Transactions At Old Republic International

Over the last year, we can see that the biggest insider sale was by the Lead Independent Director, Arnold Steiner, for US$847k worth of shares, at about US$21.27 per share. That means that even when the share price was below the current price of US$22.71, an insider wanted to cash in some shares. We generally consider it a negative if insiders have been selling on market, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. Please do note, however, that sellers may have a variety of reasons for selling, so we don’t know for sure what they think of the stock price. It is worth noting that this sale was only 5% of Arnold Steiner’s holding.

Over the last year, we can see that insiders have bought 6000 shares worth US$120k. But insiders sold 41000 shares worth US$867k. In total, Old Republic International insiders sold more than they bought over the last year. You can see the insider transactions (by individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

NYSE:ORI Recent Insider Trading, May 23rd 2019
NYSE:ORI Recent Insider Trading, May 23rd 2019

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: insiders have been buying them).

Insider Ownership

Many investors like to check how much of a company is owned by insiders. I reckon it’s a good sign if insiders own a significant number of shares in the company. Insiders own 1.4% of Old Republic International shares, worth about US$94m. We’ve certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

What Might The Insider Transactions At Old Republic International Tell Us?

There haven’t been any insider transactions in the last three months — that doesn’t mean much. We don’t take much encouragement from the transactions by Old Republic International insiders. The modest level of insider ownership is, at least, some comfort. Of course, the future is what matters most. So if you are interested in Old Republic International, you should check out this free report on analyst forecasts for the company.

Of course Old Republic International may not be the best stock to buy. So you may wish to see this free collection of high quality companies.

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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.