Don't Ignore The Insider Selling In Navitas Semiconductor

Anyone interested in Navitas Semiconductor Corporation (NASDAQ:NVTS) should probably be aware that the Independent Director, Richard Hendrix, recently divested US$323k worth of shares in the company, at an average price of US$4.04 each. That sale was 14% of their holding, so it does make us raise an eyebrow.

View our latest analysis for Navitas Semiconductor

Navitas Semiconductor Insider Transactions Over The Last Year

The Co-Founder, Daniel Kinzer, made the biggest insider sale in the last 12 months. That single transaction was for US$465k worth of shares at a price of US$3.10 each. That means that even when the share price was below the current price of US$3.77, 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. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. This single sale was just 3.3% of Daniel Kinzer's stake.

Insiders in Navitas Semiconductor didn't buy any shares in the last year. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

If you are like me, then you will not want to miss this free list of small cap stocks that are not only being bought by insiders but also have attractive valuations.

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. A high insider ownership often makes company leadership more mindful of shareholder interests. Navitas Semiconductor insiders own 20% of the company, currently worth about US$138m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Does This Data Suggest About Navitas Semiconductor Insiders?

An insider sold stock recently, but they haven't been buying. And there weren't any purchases to give us comfort, over the last year. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. While it's good to be aware of 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. Case in point: We've spotted 5 warning signs for Navitas Semiconductor you should be aware of, and 1 of them is a bit unpleasant.

Of course Navitas Semiconductor may not be the best stock to buy. So you may wish to see this free collection of high quality 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 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.