We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. 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 shareholders might well want to know whether insiders have been buying or selling shares in HD Supply Holdings, Inc. (NASDAQ:HDS).
What Is Insider Buying?
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.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year.'
Check out our latest analysis for HD Supply Holdings
The Last 12 Months Of Insider Transactions At HD Supply Holdings
Over the last year, we can see that the biggest insider purchase was by Chairman & CEO Joseph DeAngelo for US$1.8m worth of shares, at about US$36.99 per share. That means that an insider was happy to buy shares at around the current price of US$38.11. That means they have been optimistic about the company in the past, though they may have changed their mind. We do always like to see insider buying, but it is worth noting if those purchases were made at well below today's share price, as the discount to value may have narrowed with the rising price. Happily, the HD Supply Holdings insider decided to buy shares at close to current prices. The only individual insider to buy over the last year was Joseph DeAngelo.
You can see the insider transactions (by 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!
HD Supply Holdings is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Does HD Supply Holdings Boast High Insider Ownership?
Many investors like to check how much of a company is owned by insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. HD Supply Holdings insiders own about US$27m worth of shares. That equates to 0.4% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.