NASDAQ:SITM).” data-reactid=”28″ type=”text”>It is not uncommon to see companies perform well in the years after insiders buy shares. On the other hand, we’d be remiss not to mention that insider sales have been known to precede tough periods for a business. So we’ll take a look at whether insiders have been buying or selling shares in SiTime Corporation (NASDAQ:SITM).
What Is Insider Buying?
It’s quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, most countries require that the company discloses such transactions to the market.
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’.” data-reactid=”31″ type=”text”>We don’t think shareholders should simply follow insider transactions. But logic dictates you should pay some attention to whether insiders are buying or selling shares. 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’.
SiTime Insider Transactions Over The Last Year
The Executive VP & CFO Arthur Chadwick made the biggest insider purchase in the last 12 months. That single transaction was for US$650k worth of shares at a price of US$13.00 each. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of US$67.40. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn’t tell us much about what they think of current prices.
While SiTime insiders bought shares during the last year, they didn’t sell. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
list of growing companies with recent insider purchasing, could be just the ticket.” data-reactid=”52″ type=”text”>SiTime 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.
For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. Our data indicates that SiTime insiders own about US$9.6m worth of shares (which is 0.9% of the company). Overall, this level of ownership isn’t that impressive, but it’s certainly better than nothing!
So What Does This Data Suggest About SiTime Insiders?
we’ve identified 1 warning sign with SiTime and understanding it should be part of your investment process.” data-reactid=”56″ type=”text”>It doesn’t really mean much that no insider has traded SiTime shares in the last quarter. 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 SiTime stock. In addition to knowing about insider transactions going on, it’s beneficial to identify the risks facing SiTime. In terms of investment risks, we’ve identified 1 warning sign with SiTime and understanding it should be part of your investment process.
list of interesting companies, that have HIGH return on equity and low debt.” data-reactid=”57″ type=”text”>If you would prefer to check out another company — one with potentially superior financials — then do not miss this free list of interesting companies, that have HIGH return on equity and low debt.
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.