Insiders may be rethinking their US$3.4m Barnes & Noble Education, Inc. (NYSE:BNED) investment now that the company has lost US$31m in value

By
Simply Wall St
Published
May 12, 2022
NYSE:BNED
Source: Shutterstock

The recent price decline of 20% in Barnes & Noble Education, Inc.'s (NYSE:BNED) stock may have disappointed insiders who bought US$3.4m worth of shares at an average price of US$6.56 in the past 12 months. Insiders invest with the hopes of seeing their money grow in value over time. However, as a result of recent losses, their initial investment is now only worth US$1.2m, which is not what they expected.

While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

Check out our latest analysis for Barnes & Noble Education

The Last 12 Months Of Insider Transactions At Barnes & Noble Education

In the last twelve months, the biggest single purchase by an insider was when Independent Director Zachary Levenick bought US$586k worth of shares at a price of US$7.09 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$2.39). Their view may have changed since then, but at least it shows they felt optimistic at the time. To us, it's very important to consider the price insiders pay for shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.

Over the last year, we can see that insiders have bought 518.04k shares worth US$3.4m. But they sold 108.55k shares for US$1.1m. Overall, Barnes & Noble Education insiders were net buyers during the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

insider-trading-volume
NYSE:BNED Insider Trading Volume May 12th 2022

Barnes & Noble Education is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Barnes & Noble Education Insiders Bought Stock Recently

It's good to see that Barnes & Noble Education insiders have made notable investments in the company's shares. Overall, two insiders shelled out US$584k for shares in the company -- and none sold. That shows some optimism about the company's future.

Insider Ownership

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. It appears that Barnes & Noble Education insiders own 20% of the company, worth about US$25m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

What Might The Insider Transactions At Barnes & Noble Education Tell Us?

The recent insider purchases are heartening. And an analysis of the transactions over the last year also gives us confidence. But on the other hand, the company made a loss during the last year, which makes us a little cautious. Given that insiders also own a fair bit of Barnes & Noble Education we think they are probably pretty confident of a bright future. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. You'd be interested to know, that we found 3 warning signs for Barnes & Noble Education and we suggest you have a look.

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.

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