Insiders who bought Inotiv, Inc. (NASDAQ:NOTV) stock in the last 12 months were richly rewarded last week. The company's market value increased by US$56m as a result of the stock's 11% gain over the same period. As a result, their original purchase of US$1.8m worth of stock is now worth US$1.9m.
Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.
The Last 12 Months Of Insider Transactions At Inotiv
In the last twelve months, the biggest single purchase by an insider was when insider James Harkness bought US$766k worth of shares at a price of US$19.74 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of US$22.10. 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.
In the last twelve months insiders purchased 84.27k shares for US$1.8m. On the other hand they divested 3.06k shares, for US$132k. In total, Inotiv insiders bought more than they sold over the last year. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Inotiv is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Insiders At Inotiv Have Bought Stock Recently
Over the last three months, we've seen significant insider buying at Inotiv. Not only was there no selling that we can see, but they collectively bought US$222k worth of shares. This makes one think the business has some good points.
Insider Ownership Of Inotiv
For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Inotiv insiders own about US$144m worth of shares (which is 25% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
So What Do The Inotiv Insider Transactions Indicate?
It is good to see recent purchasing. And the longer term insider transactions also give us confidence. But on the other hand, the company made a loss during the last year, which makes us a little cautious. Along with the high insider ownership, this analysis suggests that insiders are quite bullish about Inotiv. One for the watchlist, at least! While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. For instance, we've identified 4 warning signs for Inotiv (1 is potentially serious) you should be aware of.
Of course Inotiv 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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