Cleveland-Cliffs Insiders Added US$2.71m Of Stock To Their Holdings

Over the last year, a good number of insiders have significantly increased their holdings in Cleveland-Cliffs Inc. (NYSE:CLF). This is encouraging because it indicates that insiders are more optimistic about the company's prospects.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

View our latest analysis for Cleveland-Cliffs

Cleveland-Cliffs Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when Chairman C. Goncalves bought US$1.0m worth of shares at a price of US$16.76 per share. That means that even when the share price was higher than US$12.87 (the recent price), an insider wanted to purchase shares. Their view may have changed since then, but at least it shows they felt optimistic at the time. We always take careful note of the price insiders pay when purchasing shares. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.

Over the last year, we can see that insiders have bought 161.45k shares worth US$2.7m. But insiders sold 42.50k shares worth US$668k. Overall, Cleveland-Cliffs insiders were net buyers during the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

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

Cleveland-Cliffs Insiders Bought Stock Recently

There has been significantly more insider buying, than selling, at Cleveland-Cliffs, over the last three months. In total, four insiders bought US$730k worth of shares in that time. But we did see Lead Independent Director Douglas Taylor sell shares worth US$535k. The buying outweighs the selling, which suggests that insiders may believe the company will do well in the future.

Insider Ownership

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. It's great to see that Cleveland-Cliffs insiders own 1.9% of the company, worth about US$114m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Do The Cleveland-Cliffs Insider Transactions Indicate?

The recent insider purchases are heartening. And the longer term insider transactions also give us confidence. Once you factor in the high insider ownership, it certainly seems like insiders are positive about Cleveland-Cliffs. One for the watchlist, at least! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Cleveland-Cliffs. Case in point: We've spotted 3 warning signs for Cleveland-Cliffs you should be aware of, and 1 of these is concerning.

Of course Cleveland-Cliffs 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.

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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.