Anyone interested in 8×8, Inc. (NYSE:EGHT) should probably be aware that the Senior VP, Matthew Zinn, recently divested US$260k worth of shares in the company, at an average price of US$20.30 each. Equally important, that sale actually reduced their holding by a full 100% which hardly makes us feel bullish about the stock.
8×8 Insider Transactions Over The Last Year
In fact, the recent sale by Matthew Zinn was the biggest sale of 8×8 shares made by an insider individual in the last twelve months, according to our records. So it’s clear an insider wanted to take some cash off the table, even slightly below the current price of US$20.41. 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. It is worth noting that this sale was 100% of Matthew Zinn’s holding.
Over the last year we saw more insider selling of 8×8 shares, than buying. The sellers received a price of around US$20.47, on average. We don’t gain confidence from insider selling near the recent share price. But we don’t put too much weight on the insider selling, since sellers could have personal reasons. The chart below shows insider transactions (by individuals) over the last year. 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 growing companies that insiders are buying.
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. Insiders own 3.5% of 8×8 shares, worth about US$74m. While this is a strong but not outstanding level of insider ownership, it’s enough to indicate some alignment between management and smaller shareholders.
So What Does This Data Suggest About 8×8 Insiders?
The insider sales have outweighed the insider buying, at 8×8, in the last three months. Despite some insider buying, the longer term picture doesn’t make us feel much more positive. Insiders own shares, but we’re still pretty cautious, given the history of sales. We’d think twice before buying! If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.
Of course 8×8 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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