Yahoo Finance Have Insiders Been Buying AppLovin Corporation (NASDAQ:APP) Shares This Year?
We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So before you buy or sell AppLovin Corporation (NASDAQ:APP), you may well want to know whether insiders have been buying or selling.
What Is Insider Selling?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, most countries require that the company discloses such transactions to the market.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But it is perfectly logical to keep tabs on what insiders are doing. 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'.
Check out our latest analysis for AppLovin
The Last 12 Months Of Insider Transactions At AppLovin
Over the last year, we can see that the biggest insider purchase was by Co-Founder Adam Foroughi for US$6.2m worth of shares, at about US$64.29 per share. That implies that an insider found the current price of US$65.16 per share to be enticing. Of course they may have changed their mind. But this suggests they are optimistic. While we always like to see insider buying, it's less meaningful if the purchases were made at much lower prices, as the opportunity they saw may have passed. The good news for AppLovin share holders is that insiders were buying at near the current price.
While AppLovin insiders bought shares during the last year, they didn't sell. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!
AppLovin 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.
Insiders at AppLovin Have Bought Stock Recently
Over the last three months, we've seen significant insider buying at AppLovin. In total, insiders bought US$9.0m worth of shares in that time, and we didn't record any sales whatsoever. This makes one think the business has some good points.
Insider Ownership of AppLovin
For a common shareholder, it is worth checking how many shares are held by company 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. AppLovin insiders own about US$6.9b worth of shares (which is 29% of the company). I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
So What Does This Data Suggest About AppLovin Insiders?
The recent insider purchases are heartening. And an analysis of the transactions over the last year also gives us confidence. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. When combined with notable insider ownership, these factors suggest AppLovin insiders are well aligned, and quite possibly think the share price is too low. One for the watchlist, at least! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For example, AppLovin has 2 warning signs (and 1 which is a bit unpleasant) we think you should know about.
Of course AppLovin 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.
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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