NYSE:UNFI).” data-reactid=”28″>We’ve lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. On the other hand, we’d be remiss not to mention that insider sales have been known to precede tough periods for a business. So we’ll take a look at whether insiders have been buying or selling shares in United Natural Foods, Inc. (NYSE:UNFI).
What Is Insider Buying?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock in the company. However, most countries require that the company discloses such transactions to the market.
study found that ‘insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers’.” data-reactid=”31″>Insider transactions are not the most important thing when it comes to long-term investing. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Columbia University study found that ‘insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers’.
View our latest analysis for United Natural Foods ” data-reactid=”36″> View our latest analysis for United Natural Foods
United Natural Foods Insider Transactions Over The Last Year
The Independent Director James Muehlbauer made the biggest insider purchase in the last 12 months. That single transaction was for US$207k worth of shares at a price of US$6.91 each. We do like to see buying, but this purchase was made at well below the current price of US$17.08. 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.
United Natural Foods insiders may have bought shares in the last year, but they didn’t sell any. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
list of growing companies that insiders are buying.” data-reactid=”52″>There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
Insider Ownership of United Natural Foods
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. United Natural Foods insiders own about US$11m worth of shares. That equates to 1.2% of the company. We’ve certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
So What Do The United Natural Foods Insider Transactions Indicate?
United Natural Foods is showing 3 warning signs in our investment analysis, and 1 of those doesn’t sit too well with us…” data-reactid=”56″>It doesn’t really mean much that no insider has traded United Natural Foods shares in the last quarter. However, our analysis of transactions over the last year is heartening. Overall we don’t see anything to make us think United Natural Foods insiders are doubting the company, and they do own shares. 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. Be aware that United Natural Foods is showing 3 warning signs in our investment analysis, and 1 of those doesn’t sit too well with us…
list of interesting companies.” data-reactid=”61″>Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
Get in touch with us directly. Alternatively, email [email protected].” data-reactid=”63″>This article by Simply Wall St is general in nature. 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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