We’ve lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So before you buy or sell Terreno Realty Corporation (NYSE:TRNO), you may well want to know whether insiders have been buying or selling.
Do Insider Transactions Matter?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock on the market. However, such insiders must disclose their trading activities, and not trade on inside information.
Insider transactions are not the most important thing when it comes to long-term investing. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Columbia University study found that ‘insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers’.
The Last 12 Months Of Insider Transactions At Terreno Realty
Independent Director David Lee made the biggest insider purchase in the last 12 months. That single transaction was for US$210k worth of shares at a price of US$42.04 each. That means that an insider was happy to buy shares at above the current price. It’s very possible they regret the purchase, but it’s more likely they are bullish about the company. That purchase may suggest an expectation of positive returns over the long term.
Happily, we note that in the last year insiders bought 10.50k shares for a total of US$419k. In total, Terreno Realty insiders bought more than they sold over the last year. They paid about US$39.91 on average. Although they bought at below the recent price of US$41.51 per share, it is good to see that insiders are willing to invest in the company. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Terreno Realty is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Insiders at Terreno Realty Have Bought Stock Recently
Over the last three months, we’ve seen significant insider buying at Terreno Realty. David Lee spent US$210k on stock, and there wasn’t any selling. That shows some optimism about the company’s future.
Insider Ownership of Terreno Realty
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 Terreno Realty insiders own 2.4% of the company, worth about US$62m. 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 Does This Data Suggest About Terreno Realty Insiders?
It is good to see recent insider purchase. We also take confidence from the longer term picture of insider transactions. Insiders likely see value in Terreno Realty shares, given these transactions (along with notable insider ownership of the company). Of course, the future is what matters most. So if you are interested in Terreno Realty, you should check out this free report on analyst forecasts for the company.
If you would prefer to check out another company — one with potentially superior financials — then do not miss this free list of interesting companies, that have HIGH return on equity and low debt.
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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. Thank you for reading.