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The Chief Marketing Officer of CarParts.com, Inc. (NASDAQ:PRTS), Houman Akhavan, Just Sold 57% Of Their Holding
Some CarParts.com, Inc. (NASDAQ:PRTS) shareholders may be a little concerned to see that the Chief Marketing Officer, Houman Akhavan, recently sold a substantial US$1.6m worth of stock at a price of US$5.27 per share. That diminished their holding by a very significant 57%, which arguably implies a strong desire to reallocate capital.
Check out our latest analysis for CarParts.com
The Last 12 Months Of Insider Transactions At CarParts.com
In fact, the recent sale by Houman Akhavan was the biggest sale of CarParts.com shares made by an insider individual in the last twelve months, according to our records. That means that even when the share price was below the current price of US$5.42, an insider wanted to cash in some shares. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. This single sale was 57% of Houman Akhavan's stake.
In the last twelve months insiders purchased 204.00k shares for US$1.1m. On the other hand they divested 310.08k shares, for US$1.7m. All up, insiders sold more shares in CarParts.com than they bought, 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!
I will like CarParts.com better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
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. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. CarParts.com insiders own about US$25m worth of shares. That equates to 8.3% of the company. 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 CarParts.com Tell Us?
Unfortunately, there has been more insider selling of CarParts.com stock, than buying, in the last three months. Zooming out, the longer term picture doesn't give us much comfort. Insiders own shares, but we're still pretty cautious, given the history of sales. We'd practice some caution before buying! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing CarParts.com. Case in point: We've spotted 2 warning signs for CarParts.com you should be aware of.
But note: CarParts.com 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.
What are the risks and opportunities for CarParts.com?
CarParts.com, Inc., together with its subsidiaries, operates as an online provider of aftermarket auto parts and accessories in the United States and the Philippines.
Rewards
Trading at 72.3% below our estimate of its fair value
Earnings are forecast to grow 50.51% per year
Risks
Shareholders have been diluted in the past year
Significant insider selling over the past 3 months
Further research on
CarParts.com
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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.
About NasdaqGS:PRTS
CarParts.com
CarParts.com, Inc., together with its subsidiaries, operates as an online provider of aftermarket auto parts and accessories in the United States and the Philippines.
Flawless balance sheet with reasonable growth potential.
