Anyone interested in ESCO Technologies Inc. (NYSE:ESE) should probably be aware that the Independent Director, Gloria Valdez, recently divested US$349k worth of shares in the company, at an average price of US$149 each. In particular, we note that the sale equated to a 100% reduction in their position size, which doesn't exactly instill confidence.
The Last 12 Months Of Insider Transactions At ESCO Technologies
In the last twelve months, the biggest single sale by an insider was when the Independent Director, Vinod Khilnani, sold US$473k worth of shares at a price of US$120 per share. That means that an insider was selling shares at slightly below the current price (US$149). 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. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. We note that the biggest single sale was only 15% of Vinod Khilnani's holding.
In the last year ESCO Technologies insiders didn't buy any company stock. 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!
I will like ESCO Technologies 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.
Does ESCO Technologies Boast High Insider Ownership?
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. It appears that ESCO Technologies insiders own 0.6% of the company, worth about US$23m. 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 Does This Data Suggest About ESCO Technologies Insiders?
An insider sold ESCO Technologies shares recently, but they didn't buy any. And there weren't any purchases to give us comfort, over the last year. But since ESCO Technologies is profitable and growing, we're not too worried by this. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. 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. For example - ESCO Technologies has 1 warning sign we think you should be aware of.
But note: ESCO Technologies may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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.
