Matthew Smith Bought 20% More Shares In Smith-Midland
Even if it's not a huge purchase, we think it was good to see that Matthew Smith, the VP of Sales & Marketing of Smith-Midland Corporation (NASDAQ:SMID) recently shelled out US$54k to buy stock, at US$27.15 per share. That purchase might not be huge but it did increase their holding by 20%.
Smith-Midland Insider Transactions Over The Last Year
Notably, that recent purchase by Matthew Smith is the biggest insider purchase of Smith-Midland shares that we've seen in the last year. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$26.03). Their view may have changed since then, but at least it shows they felt optimistic at the time. In our view, the price an insider pays for shares is very important. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.
Happily, we note that in the last year insiders paid US$108k for 4.00k shares. But insiders sold 666.00 shares worth US$22k. In the last twelve months there was more buying than selling by Smith-Midland insiders. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
Check out our latest analysis for Smith-Midland
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.
Insider Ownership
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. Insiders own 14% of Smith-Midland shares, worth about US$19m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
So What Do The Smith-Midland Insider Transactions Indicate?
It's certainly positive to see the recent insider purchases. And the longer term insider transactions also give us confidence. Given that insiders also own a fair bit of Smith-Midland we think they are probably pretty confident of a bright future. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. In terms of investment risks, we've identified 1 warning sign with Smith-Midland and understanding it should be part of your investment process.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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 of direct interests only, but not derivative transactions or indirect interests.
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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.