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Bullish insiders at American Eagle Outfitters, Inc. (NYSE:AEO) loaded up on US$623k of stock earlier this year

When a single insider purchases stock, it is typically not a major deal. However, when multiple insiders purchase stock, like in American Eagle Outfitters, Inc.'s (NYSE:AEO) instance, it's good news for shareholders.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

See our latest analysis for American Eagle Outfitters

The Last 12 Months Of Insider Transactions At American Eagle Outfitters

The Executive VP & COO, Michael Rempell, made the biggest insider sale in the last 12 months. That single transaction was for US$247k worth of shares at a price of US$19.12 each. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The silver lining is that this sell-down took place above the latest price (US$15.59). So it may not shed much light on insider confidence at current levels. The only individual insider seller over the last year was Michael Rempell.

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Happily, we note that in the last year insiders paid US$623k for 49.66k shares. On the other hand they divested 12.90k shares, for US$247k. Overall, American Eagle Outfitters insiders were net buyers during 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!

insider-trading-volume
insider-trading-volume

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).

Insider Ownership Of American Eagle Outfitters

Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. American Eagle Outfitters insiders own 5.9% of the company, currently worth about US$172m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Do The American Eagle Outfitters Insider Transactions Indicate?

The fact that there have been no American Eagle Outfitters insider transactions recently certainly doesn't bother us. On a brighter note, the transactions over the last year are encouraging. Judging from their transactions, and high insider ownership, American Eagle Outfitters insiders feel good about the company's future. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Our analysis shows 3 warning signs for American Eagle Outfitters (1 is a bit unpleasant!) and we strongly recommend you look at them before investing.

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, 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.

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