Even though ProPetro Holding Corp. (NYSE:PUMP) stock gained 13% last week, insiders who sold US$659k worth of stock over the past year are probably better off. Selling at an average price of US$9.45, which is higher than the current price, may have been the wisest decision for these insiders as their investment would have been worth less now than when they sold.
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.
The Last 12 Months Of Insider Transactions At ProPetro Holding
In the last twelve months, the biggest single sale by an insider was when the President & COO, Adam Munoz, sold US$395k worth of shares at a price of US$9.28 per share. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. The silver lining is that this sell-down took place above the latest price (US$8.24). So it may not tell us anything about how insiders feel about the current share price.
In the last year ProPetro Holding insiders didn't buy any company stock. 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!
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ProPetro Holding Insiders Are Selling The Stock
Over the last three months, we've seen a bit of insider selling at ProPetro Holding. insider Michele Patton only netted US$41k selling shares, in that period. Neither the lack of buying nor the presence of selling is heartening. But the amount sold isn't enough for us to put any weight on it.
Insider Ownership Of ProPetro Holding
Many investors like to check how much of a company is owned by insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Insiders own 7.3% of ProPetro Holding shares, worth about US$62m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
So What Do The ProPetro Holding Insider Transactions Indicate?
We did not see any insider buying in the last three months, but we did see selling. But the sales were small, so we're not concerned. Recent insider selling makes us a little nervous, in light of the broader picture of ProPetro Holding insider transactions. But it's good to see that insiders own shares in the company. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. In terms of investment risks, we've identified 2 warning signs with ProPetro Holding and understanding them should be part of your investment process.
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.