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A number of insiders bought Hooker Furnishings Corporation (NASDAQ:HOFT) stock last year, which is great news for shareholders

·3 min read

When a single insider purchases stock, it is typically not a major deal. However, when multiple insiders purchase stock, like in Hooker Furnishings Corporation's (NASDAQ:HOFT) instance, it's good news for shareholders.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

View our latest analysis for Hooker Furnishings

The Last 12 Months Of Insider Transactions At Hooker Furnishings

In the last twelve months, the biggest single purchase by an insider was when Independent Chairman Henry Williamson bought US$174k worth of shares at a price of US$34.81 per share. That means that an insider was happy to buy shares at above the current price of US$15.74. 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. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.

Hooker Furnishings insiders may have bought shares in the last year, but they didn't sell any. Their average price was about US$29.92. These transactions suggest that insiders have considered the current price attractive. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

insider-trading-volume
insider-trading-volume

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.

Hooker Furnishings Insiders Bought Stock Recently

Over the last three months, we've seen a bit of insider buying at Hooker Furnishings. Insiders purchased US$24k worth of shares in that period. We like it when there are only buyers, and no sellers. But in this case the amount purchased means the recent transaction may not be very meaningful on its own.

Insider Ownership

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. Based on our data, Hooker Furnishings insiders have about 1.8% of the stock, worth approximately US$3.4m. I generally like to see higher levels of ownership.

So What Does This Data Suggest About Hooker Furnishings Insiders?

We note a that there has been a bit of insider buying recently (but no selling). That said, the purchases were not large. On a brighter note, the transactions over the last year are encouraging. We'd like to see bigger individual holdings. However, we don't see anything to make us think Hooker Furnishings insiders are doubting the company. 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. For instance, we've identified 3 warning signs for Hooker Furnishings (1 is significant) you should be aware of.

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.