Many Masonite International Society (NYSE:DOOR) insiders have dumped their shares over the past year, which may be of interest to company shareholders. When analyzing insider trades, it is usually more useful to know whether insiders are buying rather than whether they are selling, because the latter sends an ambiguous message. However, if many insiders are selling, shareholders should investigate further.
While we don’t believe shareholders should simply follow insider trades, logic dictates that you pay attention to whether insiders are buying or selling shares.
Masonite International insider trading over the past year
Senior Vice President Robert Lewis has made the biggest insider sell in the past 12 months. This single transaction was for US$999,000 of shares at a price of US$116 each. While we generally don’t like to see insider selling, it’s more of a concern if the selling takes place at a lower price. The good news is that this big sell was well above the current price of US$97.93. So this may not shed much light on insider confidence at current levels.
Over the past year, we have seen more insider selling of Masonite International stock than buying. You can see a visual representation of insider trading (by companies and individuals) over the past 12 months, below. If you click on the chart, you can see all individual trades including stock price, individual and date!
If you like buying stocks that insiders are buying, rather than selling, then you might love this free list of companies. (Hint: insiders bought them).
Masonite International insiders sell the stock
Over the past three months, we have seen significant insider selling at Masonite International. In total, Senior Vice President Robert Lewis sold US$999,000 worth of stock during this period, and we had no purchases. In light of this, it’s hard to say that all insiders think stocks are a good deal.
Does Masonite International boast of high insider ownership?
I like to look at how many shares insiders own in a company, to help me get a sense of how aligned they are with insiders. I think it’s a good sign if insiders have a significant number of shares in the company. Masonite International insiders own approximately $16 million in stock. This equals 0.7% of the company. While this is a high but not exceptional level of insider ownership, it suffices to indicate some alignment between management and small shareholders.
What could insider trading at Masonite International tell us?
An insider hasn’t bought shares of Masonite International in the past three months, but there have been some sales. And our longer-term analysis of insider trading didn’t provide confidence either. On the positive side, Masonite International is making money and increasing profits. Insiders hold shares, but we remain quite cautious, given the history of sales. We are in no rush to buy! While we like to know what’s going on with insider ownership and trading, we also make sure to consider the risks a stock faces before making any investment decisions. You would be interested to know that we have found 3 warning signs for Masonite International and we suggest you take a look.
Sure, you might find a fantastic investment by looking elsewhere. So take a look at this free list of interesting companies.
For the purposes of this article, insiders are persons who report their transactions to the relevant regulatory body. We currently record open market transactions and private dispositions, but not derivative transactions.
Feedback on this article? Concerned about content? Get in touch with us directly. You can also email the editorial team (at) Simplywallst.com.
This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.