It is not uncommon to see companies perform well in the years after insiders buy shares. On the other hand, we’d be remiss not to mention that insider sales have been known to precede tough periods for a business. So we’ll take a look at whether insiders have been buying or selling shares in MagnaChip Semiconductor Corporation (NYSE:MX).
What Is Insider Selling?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, such insiders must disclose their trading activities, and not trade on inside information.
We don’t think shareholders should simply follow insider transactions. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Harvard University study found that ‘insider purchases earn abnormal returns of more than 6% per year.’
The Last 12 Months Of Insider Transactions At MagnaChip Semiconductor
Randal Klein made the biggest insider purchase in the last 12 months. That single transaction was for US$54k worth of shares at a price of US$10.79 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. It’s not at all bad to see insiders buy shares at or above current prices. Randal Klein was the only individual insider to buy shares in the last twelve months.
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!
I will like MagnaChip Semiconductor better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it’s a good sign if insiders own a significant number of shares in the company. Insiders own 2.2% of MagnaChip Semiconductor shares, worth about US$5.7m, according to our data. We do generally prefer see higher levels of insider ownership.
So What Does This Data Suggest About MagnaChip Semiconductor Insiders?
The fact that there have been no MagnaChip Semiconductor insider transactions recently certainly doesn’t bother us. However, our analysis of transactions over the last year is heartening. While we have no worries about the insider transactions, we’d be more comfortable if they owned more MagnaChip Semiconductor stock. Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for MagnaChip Semiconductor.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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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.