Yahoo Finance LendingTree, Inc. (NASDAQ:TREE) insiders placed bullish bets worth US$1.0m in the last 12 months
In the last year, multiple insiders have substantially increased their holdings of LendingTree, Inc. (NASDAQ:TREE) stock, indicating that insiders' optimism about the company's prospects has increased.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.
See our latest analysis for LendingTree
The Last 12 Months Of Insider Transactions At LendingTree
The Independent Director Mark Ernst made the biggest insider purchase in the last 12 months. That single transaction was for US$657k worth of shares at a price of US$65.67 each. That means that an insider was happy to buy shares at above the current price of US$25.11. 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.
While LendingTree insiders bought shares during the last year, they didn't sell. Their average price was about US$50.33. These transactions suggest that insiders have considered the current price attractive. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
LendingTree is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Insiders At LendingTree Have Bought Stock Recently
Over the last three months, we've seen significant insider buying at LendingTree. Specifically, Independent Director Mark Ernst bought US$347k worth of shares in that time, and we didn't record any sales whatsoever. This is a positive in our book as it implies some confidence.
Insider Ownership Of LendingTree
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. It appears that LendingTree insiders own 15% of the company, worth about US$48m. 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 LendingTree Insider Transactions Indicate?
It is good to see the recent insider purchase. And the longer term insider transactions also give us confidence. But we don't feel the same about the fact the company is making losses. When combined with notable insider ownership, these factors suggest LendingTree insiders are well aligned, and that they may think the share price is too low. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing LendingTree. To that end, you should learn about the 2 warning signs we've spotted with LendingTree (including 1 which is significant).
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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, but not derivative transactions.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
Join A Paid User Research Session
You’ll receive a US$30 Amazon Gift card for 1 hour of your time while helping us build better investing tools for the individual investors like yourself. Sign up here
