Fabrinet Independent Director Homa Bahrami Sells 31% Of Holding \

Some Fabrinet (NYSE:FN) shareholders may be a little concerned to see that the Independent Director, Homa Bahrami, recently sold a substantial US$997k worth of stock at a price of US$99.72 per share. That sale reduced their total holding by 31% which is hardly insignificant, but far from the worst we've seen.

See our latest analysis for Fabrinet

Fabrinet Insider Transactions Over The Last Year

The Founder & Chairman, David Mitchell, made the biggest insider sale in the last 12 months. That single transaction was for US$5.5m worth of shares at a price of US$112 each. That means that an insider was selling shares at slightly below the current price (US$119). As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. This single sale was 64% of David Mitchell's stake.

Insiders in Fabrinet didn't buy any shares in the last year. 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!

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

Insider Ownership Of Fabrinet

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. Fabrinet insiders own about US$25m worth of shares. That equates to 0.6% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

What Might The Insider Transactions At Fabrinet Tell Us?

Insiders sold Fabrinet shares recently, but they didn't buy any. And there weren't any purchases to give us comfort, over the last year. On the plus side, Fabrinet makes money, and is growing profits. Insiders own shares, but we're still pretty cautious, given the history of sales. We're in no rush to buy! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Fabrinet. Case in point: We've spotted 1 warning sign for Fabrinet you should be aware of.

But note: Fabrinet 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, 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.