Don't Ignore The Insider Selling In Comstock Holding Companies

Anyone interested in Comstock Holding Companies, Inc. (NASDAQ:CHCI) should probably be aware that the Independent Director, David Guernsey, recently divested US$100k worth of shares in the company, at an average price of US$10.01 each. That sale was 18% of their holding, so it does make us raise an eyebrow.

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The Last 12 Months Of Insider Transactions At Comstock Holding Companies

In fact, the recent sale by Independent Director David Guernsey was not their only sale of Comstock Holding Companies shares this year. They previously made an even bigger sale of -US$112k worth of shares at a price of US$10.00 per share. That means that an insider was selling shares at slightly below the current price (US$10.38). We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. We note that the biggest single sale was only 19% of David Guernsey's holding.

Comstock Holding Companies insiders didn't buy any shares over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

See our latest analysis for Comstock Holding Companies

I will like Comstock Holding Companies better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Does Comstock Holding Companies Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company 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. Comstock Holding Companies insiders own about US$65m worth of shares (which is 64% of the company). 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 Comstock Holding Companies Insider Transactions Indicate?

Insiders sold stock recently, but they haven't been buying. Looking to the last twelve months, our data doesn't show any insider buying. On the plus side, Comstock Holding Companies makes money, and is growing profits. It is good to see high insider ownership, but the insider selling leaves us cautious. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Comstock Holding Companies. Case in point: We've spotted 2 warning signs for Comstock Holding Companies you should be aware of.

Of course Comstock Holding Companies 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.