Over the last year, a good number of insiders have significantly increased their holdings in Vistra Corp. (NYSE:VST). This is encouraging because it indicates that insiders are more optimistic about the company's prospects.
Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.
The Last 12 Months Of Insider Transactions At Vistra
In the last twelve months, the biggest single purchase by an insider was when CEO & Director Curtis Morgan bought US$981k worth of shares at a price of US$15.89 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of US$21.45. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.
While Vistra insiders bought shares during the last year, they didn't sell. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Vistra is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Insider Ownership of Vistra
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. 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 appears that Vistra insiders own 0.5% of the company, worth about US$51m. 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 Does This Data Suggest About Vistra Insiders?
There haven't been any insider transactions in the last three months -- that doesn't mean much. On a brighter note, the transactions over the last year are encouraging. Overall we don't see anything to make us think Vistra insiders are doubting the company, and they do own shares. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Vistra. For example - Vistra has 1 warning sign we think you should be aware of.
But note: Vistra 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.
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.