Those following along with TriMas Corporation (NASDAQ:TRS) will no doubt be intrigued by the recent purchase of shares by Shahrokh Sedaghat, Independent Director of the company, who spent a stonking US$3.3m on stock at an average price of US$23.85. While that only increased their holding size by 2.8%, it is still a big swing by our standards.
TriMas Insider Transactions Over The Last Year
In fact, the recent purchase by Independent Director Shahrokh Sedaghat was not their only acquisition of TriMas shares this year. They previously made an even bigger purchase of US$84m worth of shares at a price of US$27.73 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$24.21). It's very possible they regret the purchase, but it's more likely they are bullish about the company. 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.
Over the last year, we can see that insiders have bought 4.34m shares worth US$110m. But insiders sold 5.72k shares worth US$143k. In total, TriMas insiders bought more than they sold over the last year. 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!
View our latest analysis for TriMas
TriMas is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.
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. A high insider ownership often makes company leadership more mindful of shareholder interests. It's great to see that TriMas insiders own 20% of the company, worth about US$196m. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
What Might The Insider Transactions At TriMas Tell Us?
The recent insider purchases are heartening. We also take confidence from the longer term picture of insider transactions. When combined with notable insider ownership, these factors suggest TriMas insiders are well aligned, and quite possibly think the share price is too low. Looks promising! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing TriMas. To assist with this, we've discovered 1 warning sign that you should run your eye over to get a better picture of TriMas.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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.