Insiders Enjoy US$1.4m Return After Buying SelectQuote Stock

SelectQuote, Inc. (NYSE:SLQT) insiders who acquired shares over the previous 12 months, can probably afford to ignore the recent 12% decline in the stock price. After accounting for the recent loss, the US$759.2k worth of shares they purchased is now worth US$2.11m, suggesting a good return on their investment.

Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.

Check out our latest analysis for SelectQuote

SelectQuote Insider Transactions Over The Last Year

The Vice Chairman William Grant made the biggest insider purchase in the last 12 months. That single transaction was for US$257k worth of shares at a price of US$1.17 each. Even though the purchase was made at a significantly lower price than the recent price (US$3.24), we still think insider buying is a positive. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.

In the last twelve months SelectQuote insiders were buying shares, but not selling. You can see a visual depiction of insider transactions (by companies and 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!

SelectQuote is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.

Insider Ownership Of SelectQuote

Many investors like to check how much of a company is owned by insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. SelectQuote insiders own about US$52m worth of shares. That equates to 9.5% of the company. 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 Do The SelectQuote Insider Transactions Indicate?

It doesn't really mean much that no insider has traded SelectQuote shares in the last quarter. However, our analysis of transactions over the last year is heartening. Insiders own shares in SelectQuote and we see no evidence to suggest they are worried about the future. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. When we did our research, we found 2 warning signs for SelectQuote (1 doesn't sit too well with us!) that we believe deserve your full attention.

But note: SelectQuote 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.