We’ve lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sell Pennsylvania Real Estate Investment Trust (NYSE:PEI), you may well want to know whether insiders have been buying or selling.
Do Insider Transactions Matter?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, most countries require that the company discloses such transactions to the market.
We don’t think shareholders should simply follow insider transactions. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Harvard University study found that ‘insider purchases earn abnormal returns of more than 6% per year.
Pennsylvania Real Estate Investment Trust Insider Transactions Over The Last Year
Independent Trustee Leonard Korman made the biggest insider purchase in the last 12 months. That single transaction was for US$159k worth of shares at a price of US$5.29 each. So it’s clear an insider wanted to buy, even at a higher price than the current share price (being US$5.05). 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. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.
While Pennsylvania Real Estate Investment Trust insiders bought shares last year, they didn’t sell. The chart below shows insider transactions (by individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).
Insider Ownership of Pennsylvania Real Estate Investment Trust
Many investors like to check how much of a company is owned by insiders. I reckon it’s a good sign if insiders own a significant number of shares in the company. Insiders own 14% of Pennsylvania Real Estate Investment Trust shares, worth about US$55m. We’ve certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
What Might The Insider Transactions At Pennsylvania Real Estate Investment Trust Tell Us?
It doesn’t really mean much that no insider has traded Pennsylvania Real Estate Investment Trust shares in the last quarter. But insiders have shown more of an appetite for the stock, over the last year. Overall we don’t see anything to make us think Pennsylvania Real Estate Investment Trust insiders are doubting the company, and they do own shares. Of course, the future is what matters most. So if you are interested in Pennsylvania Real Estate Investment Trust, you should check out this free report on analyst forecasts for the company.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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, but not derivative transactions.
If you spot an error that warrants correction, please contact the editor at email@example.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
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