The recent price decline of 11% in ChargePoint Holdings, Inc.'s (NYSE:CHPT) stock may have disappointed insiders who bought US$2.90m worth of shares at an average price of US$5.79 in the past 12 months. Insiders buy with the expectation to see their investments rise in value over a period of time. However, recent losses have rendered their above investment worth US$885.0k which is not ideal.
While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.
ChargePoint Holdings Insider Transactions Over The Last Year
The Independent Chairman of the Board Bruce Chizen made the biggest insider purchase in the last 12 months. That single transaction was for US$2.9m worth of shares at a price of US$5.79 each. That means that even when the share price was higher than US$1.77 (the recent price), an insider wanted to purchase shares. Their view may have changed since then, but at least it shows they felt optimistic at the time. To us, it's very important to consider the price insiders pay for shares. It is encouraging to see an insider paid above the current price for shares, as it suggests they saw value, even at higher levels. The only individual insider to buy over the last year was Bruce Chizen.
You can see the insider transactions (by companies and individuals) over the last year depicted in the chart 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.
Insiders At ChargePoint Holdings Have Sold Stock Recently
Over the last three months, we've seen significant insider selling at ChargePoint Holdings. Specifically, insiders ditched US$166k worth of shares in that time, and we didn't record any purchases whatsoever. In light of this it's hard to argue that all the insiders think that the shares are a bargain.
Insider Ownership Of ChargePoint Holdings
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. ChargePoint Holdings insiders own about US$11m worth of shares. That equates to 1.6% of the company. 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 ChargePoint Holdings Insider Transactions Indicate?
Insiders sold stock recently, but they haven't been buying. On the other hand, the insider transactions over the last year are encouraging. And insiders do own shares. So we're not overly bothered by recent selling. 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. To assist with this, we've discovered 5 warning signs that you should run your eye over to get a better picture of ChargePoint Holdings.
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.