Generally, when a single insider buys stock, it is usually not a big deal. However, when several insiders are buying, like in the case of Science Applications International Corporation (NASDAQ:SAIC), it sends a favourable message to the company's shareholders.
While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.
We've discovered 1 warning sign about Science Applications International. View them for free.The Last 12 Months Of Insider Transactions At Science Applications International
The Independent Director, Katharina McFarland, made the biggest insider sale in the last 12 months. That single transaction was for US$381k worth of shares at a price of US$118 each. So we know that an insider sold shares at around the present share price of US$117. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. We note that this sale took place at around the current price, so it isn't a major concern, though it's hardly a good sign. Katharina McFarland was the only individual insider to sell over the last year.
Happily, we note that in the last year insiders paid US$1.3m for 11.54k shares. But insiders sold 3.24k shares worth US$381k. In the last twelve months there was more buying than selling by Science Applications International insiders. 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 Science Applications International
There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).
Science Applications International Insiders Bought Stock Recently
Over the last quarter, Science Applications International insiders have spent a meaningful amount on shares. Not only was there no selling that we can see, but they collectively bought US$775k worth of shares. This is a positive in our book as it implies some confidence.
Insider Ownership Of Science Applications International
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 appears that Science Applications International insiders own 1.1% of the company, worth about US$63m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
What Might The Insider Transactions At Science Applications International Tell Us?
The recent insider purchases are heartening. And the longer term insider transactions also give us confidence. Given that insiders also own a fair bit of Science Applications International we think they are probably pretty confident of a bright future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Science Applications International. To assist with this, we've discovered 1 warning sign that you should run your eye over to get a better picture of Science Applications International.
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.
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.