Last week, Malibu Boats, Inc. (NASDAQ:MBUU) insiders, who had purchased shares in the previous 12 months were rewarded handsomely. The shares increased by 10% last week, resulting in a US$83m increase in the company's market worth, implying a 22% gain on their initial purchase. As a result, the stock they originally bought for US$1.20m is now worth US$1.47m.
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.
Malibu Boats Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when Independent Director Mark Lanigan bought US$669k worth of shares at a price of US$33.43 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of US$45.22. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.
Malibu Boats insiders may have bought shares in the last year, but they didn't sell any. They paid about US$37.04 on average. We don't deny that it is nice to see insiders buying stock in the company. But we must note that the investments were made at well below today's share price. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
Malibu Boats is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.
Does Malibu Boats Boast High Insider Ownership?
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. Malibu Boats insiders own about US$15m worth of shares. That equates to 1.7% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
So What Do The Malibu Boats Insider Transactions Indicate?
There haven't been any insider transactions in the last three months -- that doesn't mean much. On a brighter note, the transactions over the last year are encouraging. Overall we don't see anything to make us think Malibu Boats insiders are doubting the company, and they do own shares. Of course, the future is what matters most. So if you are interested in Malibu Boats, you should check out this free report on analyst forecasts for the company.
Of course Malibu Boats may not be the best stock to buy. So you may wish to see this free collection of high quality 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.
