Bullish Shoe Carnival Insider Buying Worth US$9.68m Yet To Pay Off

Insiders who acquired US$9.68m worth of Shoe Carnival, Inc.'s (NASDAQ:SCVL) stock at an average price of US$33.91 in the past 12 months may be dismayed by the recent 16% price decline. This is not good as insiders invest based on expectations that their money will appreciate over time. However, as a result of recent losses, their original investment is now worth only US$5.31m.

Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.

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The Last 12 Months Of Insider Transactions At Shoe Carnival

Over the last year, we can see that the biggest insider purchase was by Executive Chairman of the Board J. Weaver for US$9.7m worth of shares, at about US$33.91 per share. That means that an insider was happy to buy shares at above the current price of US$18.59. It's very possible they regret the purchase, but it's more likely they are bullish about the company. In our view, the price an insider pays for shares is very important. As a general rule, we feel more positive about a stock when an insider has bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price. J. Weaver was the only individual insider to buy shares in the last twelve months.

You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

See our latest analysis for Shoe Carnival

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.

Insider Ownership Of Shoe Carnival

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. Shoe Carnival insiders own 35% of the company, currently worth about US$192m based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Does This Data Suggest About Shoe Carnival Insiders?

It doesn't really mean much that no insider has traded Shoe Carnival shares in the last quarter. But insiders have shown more of an appetite for the stock, over the last year. It would be great to see more insider buying, but overall it seems like Shoe Carnival insiders are reasonably well aligned (owning significant chunk of the company's shares) and optimistic for the future. Therefore, you should definitely take a look at this FREE report showing analyst forecasts for Shoe Carnival.

But note: Shoe Carnival 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.

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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.