Selling 8x8 Shares at a Lower Price Than Current Market Value May Have Been a Costly Mistake for Insiders

Even though 8x8, Inc. (NASDAQ:EGHT) has fallen by 11% over the past week , insiders who sold US$885k worth of stock over the past year have had less luck. The average selling price of US$2.40 is still lower than the current share price, or in other words, insiders would have been better off holding on to their shares.

While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.

View our latest analysis for 8x8

The Last 12 Months Of Insider Transactions At 8x8

In the last twelve months, the biggest single sale by an insider was when the CEO & Director, Samuel Wilson, sold US$166k worth of shares at a price of US$3.53 per share. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. It's of some comfort that this sale was conducted at a price well above the current share price, which is US$1.96. So it may not shed much light on insider confidence at current levels.

In the last year 8x8 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!

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: Most of them are flying under the radar).

Insiders At 8x8 Have Sold Stock Recently

The last quarter saw substantial insider selling of 8x8 shares. In total, insiders dumped US$159k worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.

Insider Ownership Of 8x8

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. From our data, it seems that 8x8 insiders own 2.5% of the company, worth about US$6.1m. Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!

What Might The Insider Transactions At 8x8 Tell Us?

Insiders sold 8x8 shares recently, but they didn't buy any. And there weren't any purchases to give us comfort, over the last year. Insiders own relatively few shares in the company, and when you consider the sales, we're not particularly excited about the stock. So we'd only buy after very careful consideration. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing 8x8. Every company has risks, and we've spotted 4 warning signs for 8x8 you should know about.

But note: 8x8 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.