It is usually uneventful when a single insider buys stock. However, When quite a few insiders buy shares, as it happened in Kemper Corporation's (NYSE:KMPR) case, it's fantastic news for shareholders.
Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.
Kemper Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider purchase was by Independent Director Stuart Parker for US$414k worth of shares, at about US$41.40 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of US$59.42. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.
While Kemper insiders bought shares during the last year, they didn't sell. The average buy price was around US$46.81. To my mind it is good that insiders have invested their own money in the company. But we must note that the investments were made at well below today's share price. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
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.
Kemper Insiders Bought Stock Recently
Over the last quarter, Kemper insiders have spent a meaningful amount on shares. Not only was there no selling that we can see, but they collectively bought US$330k worth of shares. That shows some optimism about the company's future.
Insider Ownership Of Kemper
For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. It's great to see that Kemper insiders own 4.6% of the company, worth about US$177m. 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 Do The Kemper Insider Transactions Indicate?
It is good to see recent purchasing. We also take confidence from the longer term picture of insider transactions. But we don't feel the same about the fact the company is making losses. Once you factor in the high insider ownership, it certainly seems like insiders are positive about Kemper. One for the watchlist, at least! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. You'd be interested to know, that we found 2 warning signs for Kemper and we suggest you have a look.
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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com