Last week, Tactile Systems Technology, Inc.'s (NASDAQ:TCMD) stock jumped 11%, but insiders who sold US$257k worth of stock in over the past year are likely to be in a better position. Selling at an average price of US$14.81, which is higher than the current price, may have been the best move for these insiders because their investment would have been worth less now than when they sold.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.
View our latest analysis for Tactile Systems Technology
The Last 12 Months Of Insider Transactions At Tactile Systems Technology
The President, Daniel Reuvers, made the biggest insider sale in the last 12 months. That single transaction was for US$108k worth of shares at a price of US$15.27 each. That means that even when the share price was below the current price of US$25.63, an insider wanted to cash in some shares. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. 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 20% of Daniel Reuvers's holding.
Over the last year we saw more insider selling of Tactile Systems Technology shares, than buying. 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!
For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Does Tactile Systems Technology Boast High 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. Based on our data, Tactile Systems Technology insiders have about 0.7% of the stock, worth approximately US$4.3m. We consider this fairly low insider ownership.
So What Does This Data Suggest About Tactile Systems Technology Insiders?
The fact that there have been no Tactile Systems Technology insider transactions recently certainly doesn't bother us. The insider transactions at Tactile Systems Technology are not inspiring us to buy. We also note that, as far as we can see, insider ownership is fairly low, compared to other companies. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Tactile Systems Technology. Case in point: We've spotted 1 warning sign for Tactile Systems Technology you should be aware of.
Of course Tactile Systems Technology may not be the best stock to buy. So you may wish to see this free collection of high quality 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, but not derivative transactions.
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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.
