Yahoo Finance Insiders of Rocket Companies, Inc. (NYSE:RKT) are probably glad they bought last year as their US$1.2m investment now stands at US$1.4m
Insiders who purchased Rocket Companies, Inc. (NYSE:RKT) shares in the past 12 months are unlikely to be deeply impacted by the stock's 6.7% decline over the past week. After taking the recent loss into consideration, the US$1.2m worth of stock they bought is now worth US$1.4m, indicating that their investment yielded a positive return.
Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.
See our latest analysis for Rocket Companies
Rocket Companies Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider purchase was by Chief Executive Officer Jay Farner for US$400k worth of shares, at about US$6.40 per share. We do like to see buying, but this purchase was made at well below the current price of US$8.06. 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.
Rocket Companies insiders may have bought shares in the last year, but they didn't sell any. Their average price was about US$7.23. 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 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!
There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).
Does Rocket Companies Boast High Insider Ownership?
Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Rocket Companies insiders own about US$54m worth of shares. That equates to 0.3% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
So What Do The Rocket Companies Insider Transactions Indicate?
The fact that there have been no Rocket Companies insider transactions recently certainly doesn't bother us. But insiders have shown more of an appetite for the stock, over the last year. Insiders do have a stake in Rocket Companies and their transactions don't cause us concern. 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. In terms of investment risks, we've identified 2 warning signs with Rocket Companies and understanding these should be part of your investment process.
Of course Rocket Companies 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, but not derivative transactions.
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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.
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