Snowflake Insiders Added US$15.5m Of Stock To Their Holdings

Multiple insiders secured a larger position in Snowflake Inc. (NYSE:SNOW) shares over the last 12 months. This is reassuring as this suggests that insiders have increased optimism about the company's prospects.

While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.

Check out our latest analysis for Snowflake

The Last 12 Months Of Insider Transactions At Snowflake

The Lead Independent Director Michael Speiser made the biggest insider purchase in the last 12 months. That single transaction was for US$10.0m worth of shares at a price of US$131 each. That means that even when the share price was higher than US$114 (the recent price), an insider wanted to purchase shares. It's very possible they regret the purchase, but it's more likely they are bullish about the company. We always take careful note of the price insiders pay when purchasing shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.

Happily, we note that in the last year insiders paid US$15m for 110.77k shares. But they sold 26.87k shares for US$3.9m. Overall, Snowflake insiders were net buyers during the last year. 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!

There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).

Insiders At Snowflake Have Sold Stock Recently

The last quarter saw substantial insider selling of Snowflake shares. In total, Executive Vice President of Product Management Christian Kleinerman dumped US$346k worth of shares in that time, and we didn't record any purchases whatsoever. Overall this makes us a bit cautious, but it's not the be all and end all.

Insider Ownership Of Snowflake

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. Snowflake insiders own 5.7% of the company, currently worth about US$2.2b based on the recent share price. 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 Does This Data Suggest About Snowflake Insiders?

An insider hasn't bought Snowflake stock in the last three months, but there was some selling. In contrast, they appear keener if you look at the last twelve months. On top of that, insiders own a significant portion of the company. So we're happy to look past recent trading. 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. For instance, we've identified 2 warning signs for Snowflake (1 is concerning) you should be aware of.

But note: Snowflake 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.