Genuine Parts Company (NYSE:GPC) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 4.7%, resulting in a US$1.0b rise in the company's market capitalisation. As a result, their original purchase of US$462k worth of stock is now worth US$607k.
While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
Genuine Parts Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when Independent Director John Holder bought US$261k worth of shares at a price of US$119 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of US$158. 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 Genuine Parts 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. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).
Insider Ownership Of Genuine Parts
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. Genuine Parts insiders own about US$51m worth of shares. That equates to 0.2% of the company. 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 Do The Genuine Parts Insider Transactions Indicate?
It doesn't really mean much that no insider has traded Genuine Parts shares in the last quarter. But insiders have shown more of an appetite for the stock, over the last year. Insiders own shares in Genuine Parts and we see no evidence to suggest they are worried about the future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Genuine Parts. At Simply Wall St, we found 1 warning sign for Genuine Parts that deserve your attention before buying any shares.
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.
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.
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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.
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