Insider Buying: The Rackspace Technology, Inc. (NASDAQ:RXT) Independent Lead Director Just Bought 259% More Shares

Investors who take an interest in Rackspace Technology, Inc. (NASDAQ:RXT) should definitely note that the Independent Lead Director, Shashank Samant, recently paid US$4.55 per share to buy US$455k worth of the stock. That certainly has us anticipating the best, especially since they thusly increased their own holding by 259%, potentially signalling some real optimism.

Check out the opportunities and risks within the US IT industry.

The Last 12 Months Of Insider Transactions At Rackspace Technology

In fact, the recent purchase by Shashank Samant was the biggest purchase of Rackspace Technology shares made by an insider individual in the last twelve months, according to our records. That means that an insider was happy to buy shares at around the current price of US$4.94. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. Happily, the Rackspace Technology insider decided to buy shares at close to current prices. Shashank Samant was the only individual insider to buy during the last year.

Shashank Samant bought 119.93k shares over the last 12 months at an average price of US$4.55. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

Rackspace Technology is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Does Rackspace Technology Boast High 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. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It's great to see that Rackspace Technology insiders own 11% of the company, worth about US$117m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Do The Rackspace Technology Insider Transactions Indicate?

It's certainly positive to see the recent insider purchase. And an analysis of the transactions over the last year also gives us confidence. But we don't feel the same about the fact the company is making losses. When combined with notable insider ownership, these factors suggest Rackspace Technology insiders are well aligned, and quite possibly think the share price is too low. Looks promising! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. To help with this, we've discovered 2 warning signs (1 is a bit unpleasant!) that you ought to be aware of before buying any shares in Rackspace Technology.

Of course Rackspace Technology 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, but not derivative transactions.

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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.