Yahoo Finance Insiders Re-Evaluate Their US$529.1k Stock Purchase As Methode Electronics Falls To US$392m
Insiders who bought US$529.1k worth of Methode Electronics, Inc.'s (NYSE:MEI) stock at an average buy price of US$21.82 over the last year may be disappointed by the recent 12% decrease in the stock. This is not good as insiders invest based on expectations that their money will appreciate over time. However, as a result of recent losses, their original investment is now worth only US$268.4k.
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.
Check out our latest analysis for Methode Electronics
Methode Electronics Insider Transactions Over The Last Year
The Consultant Donald Duda made the biggest insider purchase in the last 12 months. That single transaction was for US$507k worth of shares at a price of US$21.80 each. That means that even when the share price was higher than US$11.07 (the recent price), an insider wanted to purchase shares. Their view may have changed since then, but at least it shows they felt optimistic at the time. We always take careful note of the price insiders pay when purchasing shares. 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.
While Methode Electronics insiders bought shares during the last year, they didn't sell. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
Methode Electronics is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Insider Ownership
Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. It appears that Methode Electronics insiders own 3.3% of the company, worth about US$13m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
So What Does This Data Suggest About Methode Electronics Insiders?
The fact that there have been no Methode Electronics insider transactions recently certainly doesn't bother us. But insiders have shown more of an appetite for the stock, over the last year. Insiders do have a stake in Methode Electronics and their transactions don't cause us concern. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Every company has risks, and we've spotted 2 warning signs for Methode Electronics (of which 1 is significant!) you should know about.
Of course Methode Electronics 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.
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.
