NYSE:ALB), you may well want to know whether insiders have been buying or selling.” data-reactid=”28″>We often see insiders buying up shares in companies that perform well over the long term. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So before you buy or sell Albemarle Corporation (NYSE:ALB), you may well want to know whether insiders have been buying or selling.
Do Insider Transactions Matter?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock in the company. However, such insiders must disclose their trading activities, and not trade on inside information.
study found that ‘insider purchases earn abnormal returns of more than 6% per year’.” data-reactid=”31″>We don’t think shareholders should simply follow insider transactions. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Harvard University study found that ‘insider purchases earn abnormal returns of more than 6% per year’.
View our latest analysis for Albemarle ” data-reactid=”36″>View our latest analysis for Albemarle
Albemarle Insider Transactions Over The Last Year
The insider Eric Norris made the biggest insider purchase in the last 12 months. That single transaction was for US$200k worth of shares at a price of US$64.66 each. Even though the purchase was made at a significantly lower price than the recent price (US$83.34), we still think insider buying is a positive. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn’t tell us much about what they think of current prices.
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!
list of growing companies that insiders are buying.” data-reactid=”52″>There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
Insider Ownership of Albemarle
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Albemarle insiders own about US$47m worth of shares. That equates to 0.5% of the company. 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 Albemarle Insiders?
2 warning signs for Albemarle and we suggest you have a look.” data-reactid=”56″>The fact that there have been no Albemarle insider transactions recently certainly doesn’t bother us. However, our analysis of transactions over the last year is heartening. Insiders own shares in Albemarle and we see no evidence to suggest they are worried about the future. In addition to knowing about insider transactions going on, it’s beneficial to identify the risks facing Albemarle. You’d be interested to know, that we found 2 warning signs for Albemarle and we suggest you have a look.
collection of high quality companies.” data-reactid=”57″>Of course Albemarle may not be the best stock to buy. So you may wish to see this free collection of high quality companies.
Get in touch with us directly. Alternatively, email [email protected].” data-reactid=”63″>This article by Simply Wall St is general in nature. 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.