Insider Spends US$1.1m Buying More Shares In Dow

Those following along with Dow Inc. (NYSE:DOW) will no doubt be intrigued by the recent purchase of shares by James Fitterling, Chairman & CEO of the company, who spent a stonking US$1.1m on stock at an average price of US$41.49. While that only increased their holding size by 7.4%, it is still a big swing by our standards.

Check out our latest analysis for Dow

The Last 12 Months Of Insider Transactions At Dow

Notably, that recent purchase by James Fitterling is the biggest insider purchase of Dow shares that we've seen in the last year. That means that an insider was happy to buy shares at above the current price of US$40.57. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. In our view, the price an insider pays for shares is very important. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.

In the last twelve months Dow 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. By clicking on the graph below, you can see the precise details of each insider transaction!

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

Does Dow Boast High 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 appears that Dow insiders own 0.2% of the company, worth about US$50m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Do The Dow Insider Transactions Indicate?

It is good to see recent purchasing. And the longer term insider transactions also give us confidence. Given that insiders also own a fair bit of Dow we think they are probably pretty confident of a bright future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Dow. For instance, we've identified 3 warning signs for Dow (1 is a bit unpleasant) you should be aware of.

But note: Dow 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.