Generally, when a single insider buys stock, it is usually not a big deal. However, when several insiders are buying, like in the case of Shoals Technologies Group, Inc. (NASDAQ:SHLS), it sends a favourable message to the company's shareholders.

While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.

Shoals Technologies Group Insider Transactions Over The Last Year

The Director & CEO Brandon Moss made the biggest insider purchase in the last 12 months. That single transaction was for US$101k worth of shares at a price of US$4.55 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$4.53). It's very possible they regret the purchase, but it's more likely they are bullish about the company. To us, it's very important to consider the price insiders pay for shares. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.

Over the last year, we can see that insiders have bought 37.30k shares worth US$172k. On the other hand they divested 10.31k shares, for US$118k. Overall, Shoals Technologies Group insiders were net buyers during the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.

Shoals Technologies Group Insiders Bought Stock Recently

Over the last three months, we've seen significantly more insider buying, than insider selling, at Shoals Technologies Group. In total, two insiders bought US$172k worth of shares in that time. On the other hand, insiders netted US$16k by selling. The buying outweighs the selling, which suggests that insiders may believe the company will do well in the future.

Does Shoals Technologies Group 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. I reckon it's a good sign if insiders own a significant number of shares in the company. From our data, it seems that Shoals Technologies Group insiders own 0.6% of the company, worth about US$5.0m. We do generally prefer see higher levels of insider ownership.

So What Does This Data Suggest About Shoals Technologies Group Insiders?

The recent insider purchases are heartening. And the longer term insider transactions also give us confidence. While the overall levels of insider ownership are below what we'd like to see, the history of transactions imply that Shoals Technologies Group insiders are reasonably well aligned, and optimistic for the future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Shoals Technologies Group. For example - Shoals Technologies Group has 2 warning signs we think you should be aware of.

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.