Investors may wish to note that the Chief Financial Officer of RCI Hospitality Holdings, Inc., Bradley Chhay, recently netted US$81k from selling stock, receiving an average price of US$43.50. It wasn't a huge sale, but it did reduce their holding by 34%. This does not instill confidence.
The Last 12 Months Of Insider Transactions At RCI Hospitality Holdings
Notably, that recent sale by Bradley Chhay is the biggest insider sale of RCI Hospitality Holdings shares that we've seen in the last year. That means that even when the share price was below the current price of US$46.34, 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. However, while insider selling is sometimes discouraging, it's only a weak signal. It is worth noting that this sale was only 34% of Bradley Chhay's holding.
Over the last year, we can see that insiders have bought 2.97k shares worth US$155k. On the other hand they divested 5.61k shares, for US$244k. Over the last year we saw more insider selling of RCI Hospitality Holdings shares, than buying. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
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Insider Ownership
For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. RCI Hospitality Holdings insiders own about US$34m worth of shares. That equates to 8.2% of the company. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
What Might The Insider Transactions At RCI Hospitality Holdings Tell Us?
Insiders sold stock recently, but they haven't been buying. And our longer term analysis of insider transactions didn't bring confidence, either. Insiders own shares, but we're still pretty cautious, given the history of sales. We're in no rush to buy! 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 help with this, we've discovered 4 warning signs (1 is significant!) that you ought to be aware of before buying any shares in RCI Hospitality Holdings.
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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.
