Don't Ignore The Insider Selling In World Acceptance
We wouldn't blame World Acceptance Corporation (NASDAQ:WRLD) shareholders if they were a little worried about the fact that Ken Bramlett, the Independent Chairman of the Board recently netted about US$672k selling shares at an average price of US$177. That's a big disposal, and it decreased their holding size by 12%, which is notable but not too bad.
World Acceptance Insider Transactions Over The Last Year
In the last twelve months, the biggest single sale by an insider was when the insider, Daniel Dyer, sold US$1.3m worth of shares at a price of US$150 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of US$166. We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. We note that the biggest single sale was only 21% of Daniel Dyer's holding.
Insiders in World Acceptance didn't buy any shares in the last year. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
View our latest analysis for World Acceptance
I will like World Acceptance better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.
Does World Acceptance Boast High Insider Ownership?
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. World Acceptance insiders own about US$138m worth of shares (which is 19% of the company). Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
So What Does This Data Suggest About World Acceptance Insiders?
Insiders sold stock recently, but they haven't been buying. Looking to the last twelve months, our data doesn't show any insider buying. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing World Acceptance. Every company has risks, and we've spotted 2 warning signs for World Acceptance (of which 1 doesn't sit too well with us!) you should know about.
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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