Many Eagle Materials Inc. (NYSE:EXP) insiders ditched their stock over the past year, which may be of interest to the company's shareholders. Knowing whether insiders are buying is usually more helpful when evaluating insider transactions, as insider selling can have various explanations. However, if numerous insiders are selling, shareholders should investigate more.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.
Eagle Materials Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider sale was by the Independent Director, Richard Stewart, for US$1.1m worth of shares, at about US$300 per share. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. The silver lining is that this sell-down took place above the latest price (US$202). So it may not tell us anything about how insiders feel about the current share price.
In the last twelve months insiders purchased 1.31k shares for US$293k. On the other hand they divested 8.33k shares, for US$2.5m. In total, Eagle Materials insiders sold more than they bought over the last year. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Check out our latest analysis for Eagle Materials
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Insiders At Eagle Materials Have Bought Stock Recently
Over the last quarter, Eagle Materials insiders have spent a meaningful amount on shares. We can see that Independent Director David Rush paid US$214k for shares in the company. No-one sold. This makes one think the business has some good points.
Insider Ownership
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. Eagle Materials insiders own about US$74m worth of shares. That equates to 1.1% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
So What Do The Eagle Materials Insider Transactions Indicate?
The recent insider purchase is heartening. However, the longer term transactions are not so encouraging. While recent transactions indicate confidence in Eagle Materials, insiders don't own enough of the company to overcome our cautiousness about the longer term transactions. In short they are likely aligned with shareholders. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Eagle Materials. At Simply Wall St, we found 1 warning sign for Eagle Materials that deserve your attention before buying any shares.
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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.