We wouldn't blame FirstCash Holdings, Inc. (NASDAQ:FCFS) shareholders if they were a little worried about the fact that Douglas Rippel, the Director recently netted about US$878k selling shares at an average price of US$120. However, that sale only accounted for 0.2% of their holding, so arguably it doesn't say much about their conviction.
The Last 12 Months Of Insider Transactions At FirstCash Holdings
Notably, that recent sale by Director Douglas Rippel was not the only time they sold FirstCash Holdings shares this year. They previously made an even bigger sale of -US$85m worth of shares at a price of US$118 per share. So it's clear an insider wanted to take some cash off the table, even slightly below the current price of US$119. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower 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. It is worth noting that this sale was only 13% of Douglas Rippel's holding.
In the last year FirstCash Holdings insiders didn't buy any company stock. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
I will like FirstCash Holdings 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.
Insider Ownership
Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. It's great to see that FirstCash Holdings insiders own 13% of the company, worth about US$710m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
What Might The Insider Transactions At FirstCash Holdings Tell Us?
An insider sold FirstCash Holdings shares recently, but they didn't buy any. And there weren't any purchases to give us comfort, over the last year. But since FirstCash Holdings is profitable and growing, we're not too worried by this. It is good to see high insider ownership, but the insider selling leaves us cautious. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. While conducting our analysis, we found that FirstCash Holdings has 2 warning signs and it would be unwise to ignore these.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity and low debt.
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.
