Last week, Corteva, Inc. (NYSE:CTVA) insiders, who had purchased shares in the previous 12 months were rewarded handsomely. The shares increased by 9.1% last week, resulting in a US$3.5b increase in the company's market worth. As a result, their original purchase of US$2.6m worth of stock is now worth US$2.9m.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.
Corteva Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when CEO & Director Charles Magro bought US$2.6m worth of shares at a price of US$51.59 per share. Even though the purchase was made at a significantly lower price than the recent price (US$57.61), we still think insider buying is a positive. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.
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!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
Insiders at Corteva Have Sold Stock Recently
Over the last three months, we've seen significant insider selling at Corteva. In total, Independent Director Klaus Engel dumped US$158k worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. It appears that Corteva insiders own 0.06% of the company, worth about US$24m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
What Might The Insider Transactions At Corteva Tell Us?
An insider sold stock recently, but they haven't been buying. But we take heart from prior transactions. It's good to see insiders are shareholders. So we're happy enough to look past some selling. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Every company has risks, and we've spotted 1 warning sign for Corteva you should know about.
But note: Corteva 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, but not derivative transactions.
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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.