Yahoo Finance Insider Buying: The RLJ Lodging Trust (NYSE:RLJ) Independent Director Just Bought US$63k Worth Of Shares
Whilst it may not be a huge deal, we thought it was good to see that the RLJ Lodging Trust (NYSE:RLJ) Independent Director, Patricia Gibson, recently bought US$63k worth of stock, for US$12.62 per share. While we're hesitant to get too excited about a purchase of that size, we do note it increased their holding by a solid 13%.
View our latest analysis for RLJ Lodging Trust
RLJ Lodging Trust Insider Transactions Over The Last Year
In fact, the recent purchase by Independent Director Patricia Gibson was not their only acquisition of RLJ Lodging Trust shares this year. Earlier in the year, they paid US$16.37 per share in a US$164k purchase. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$10.24). While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. To us, it's very important to consider the price insiders pay for shares is very important. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.
RLJ Lodging Trust insiders may have bought shares in the last year, but they didn't sell any. You can see a visual depiction of insider transactions (by 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!
RLJ Lodging Trust is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Insider Ownership of RLJ Lodging Trust
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 1.8% of RLJ Lodging Trust shares, worth about US$36m. 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 RLJ Lodging Trust Insider Transactions Indicate?
The recent insider purchase is heartening. We also take confidence from the longer term picture of insider transactions. When combined with notable insider ownership, these factors suggest RLJ Lodging Trust insiders are well aligned, and that they may think the share price is too low. 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. Our analysis shows 3 warning signs for RLJ Lodging Trust (1 doesn't sit too well with us!) and we strongly recommend you look at these before investing.
But note: RLJ Lodging Trust may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.
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