Digimarc Insiders Miss 14% Gain After Offloading Stock

Despite the fact that Digimarc Corporation (NASDAQ:DMRC) stock rose 14% last week, insiders who sold US$415k worth of stock in the previous 12 months are likely to be better off. Selling at an average price of US$24.55, which is higher than the current price, may have been the wisest decision for these insiders as their investment would have been worth less now than when they sold.

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.

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Digimarc Insider Transactions Over The Last Year

The insider, Alicia Syrett, made the biggest insider sale in the last 12 months. That single transaction was for US$106k worth of shares at a price of US$24.20 each. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. The silver lining is that this sell-down took place above the latest price (US$13.25). So it may not tell us anything about how insiders feel about the current share price.

In the last year Digimarc insiders didn't buy any company stock. 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!

See our latest analysis for Digimarc

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Insider Ownership

Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that Digimarc insiders own 23% of the company, worth about US$60m. 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 Digimarc Tell Us?

There haven't been any insider transactions in the last three months -- that doesn't mean much. Our analysis of Digimarc insider transactions leaves us cautious. But we do like the fact that insiders own a fair chunk of the company. 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. To that end, you should learn about the 4 warning signs we've spotted with Digimarc (including 2 which can't be ignored).

But note: Digimarc 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.