Insider Buying: The CommScope Holding Company, Inc. (NASDAQ:COMM) Senior VP & President of Outdoor Wireless Networks Just Bought 14% More Shares

By
Simply Wall St
Published
May 14, 2022
NasdaqGS:COMM
Source: Shutterstock

Even if it's not a huge purchase, we think it was good to see that Farid Firouzbakht, the Senior VP & President of Outdoor Wireless Networks of CommScope Holding Company, Inc. (NASDAQ:COMM) recently shelled out US$70k to buy stock, at US$6.97 per share. That purchase might not be huge but it did increase their holding by 14%.

Check out our latest analysis for CommScope Holding Company

CommScope Holding Company Insider Transactions Over The Last Year

The Chairman of the Board Claudius Watts made the biggest insider purchase in the last 12 months. That single transaction was for US$992k worth of shares at a price of US$15.26 each. That means that an insider was happy to buy shares at above the current price of US$7.20. 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. We always take careful note of the price insiders pay when purchasing shares. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.

CommScope Holding Company insiders may have bought shares in the last year, but they didn't sell any. They paid about US$10.26 on average. I'd consider this a positive as it suggests insiders see value at around the current price. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

insider-trading-volume
NasdaqGS:COMM Insider Trading Volume May 14th 2022

There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).

Insider Ownership

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. It appears that CommScope Holding Company insiders own 2.6% of the company, worth about US$38m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Do The CommScope Holding Company Insider Transactions Indicate?

It is good to see recent purchasing. And an analysis of the transactions over the last year also gives us confidence. But on the other hand, the company made a loss during the last year, which makes us a little cautious. Insiders likely see value in CommScope Holding Company shares, given these transactions (along with notable insider ownership of the company). So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Case in point: We've spotted 2 warning signs for CommScope Holding Company you should be aware of.

Of course CommScope Holding Company 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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