Build-A-Bear Workshop Insiders Forfeit On 13% Gains After Selling Stock
Even though Build-A-Bear Workshop, Inc. (NYSE:BBW) stock gained 13% last week, insiders who sold US$104k worth of stock over the past year are probably better off. Selling at an average price of US$34.52, which is higher than the current price might have been the right call as holding on to stock would have meant their investment would be worth less now than it was at the time of sale.
While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
The Last 12 Months Of Insider Transactions At Build-A-Bear Workshop
Over the last year, we can see that the biggest insider sale was by the Independent Director, George Carrara, for US$104k worth of shares, at about US$34.52 per share. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. The silver lining is that this sell-down took place above the latest price (US$27.48). So it may not tell us anything about how insiders feel about the current share price. The only individual insider seller over the last year was George Carrara.
You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
See our latest analysis for Build-A-Bear Workshop
For those who like to find hidden gems this free list of small cap companies with recent insider purchasing, could be just the ticket.
Insider Ownership Of Build-A-Bear Workshop
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with 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. Insiders own 5.7% of Build-A-Bear Workshop shares, worth about US$17m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
So What Do The Build-A-Bear Workshop Insider Transactions Indicate?
There haven't been any insider transactions in the last three months -- that doesn't mean much. Still, the insider transactions at Build-A-Bear Workshop in the last 12 months are not very heartening. The modest level of insider ownership is, at least, some comfort. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. In terms of investment risks, we've identified 2 warning signs with Build-A-Bear Workshop and understanding these should be part of your investment process.
But note: Build-A-Bear Workshop 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 of direct interests only, but not derivative transactions or indirect interests.
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