Yahoo Finance Several Insiders Invested In Compass Minerals International Flagging Positive News
Usually, when one insider buys stock, it might not be a monumental event. But when multiple insiders are buying like they did in the case of Compass Minerals International, Inc. (NYSE:CMP), that sends out a positive message to the company's shareholders.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.
View our latest analysis for Compass Minerals International
The Last 12 Months Of Insider Transactions At Compass Minerals International
Over the last year, we can see that the biggest insider purchase was by Independent Non-Executive Chairman of the Board Joseph Reece for US$106k worth of shares, at about US$21.24 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$13.04). It's very possible they regret the purchase, but it's more likely they are bullish about the company. In our view, the price an insider pays for shares is very important. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.
In the last twelve months Compass Minerals International insiders were buying shares, but not selling. The average buy price was around US$23.55. This is nice to see since it implies that insiders might see value around current prices. 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!
Compass Minerals International 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.
Does Compass Minerals International Boast High Insider Ownership?
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. From looking at our data, insiders own US$4.3m worth of Compass Minerals International stock, about 0.8% of the company. However, it's possible that insiders might have an indirect interest through a more complex structure. We consider this fairly low insider ownership.
So What Does This Data Suggest About Compass Minerals International Insiders?
The fact that there have been no Compass Minerals International insider transactions recently certainly doesn't bother us. However, our analysis of transactions over the last year is heartening. While we have no worries about the insider transactions, we'd be more comfortable if they owned more Compass Minerals International stock. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Compass Minerals International. While conducting our analysis, we found that Compass Minerals International has 2 warning signs and it would be unwise to ignore them.
Of course Compass Minerals International 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 of direct interests only, but not derivative transactions or indirect interests.
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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.
