Read This Before Buying Hubbell Incorporated Stock (NYSE: HUBB)
It is not uncommon to see companies perform well in the years following an insider purchase of shares. Unfortunately, there are also many examples of stock prices dropping sharply after insiders sell stocks. Shareholders might therefore want to know if any insiders bought or sold shares of Hubbell Incorporated (NYSE: HUBB).
Are Insider Trading Important?
It is quite normal to see company insiders, such as members of the board of directors, from time to time trading in company shares. However, there are rules governing insider trading and certain information is required.
Insider trading is not the most important thing when it comes to investing for the long term. But also, we would consider it foolish to ignore insider trading altogether. For example, a Columbia University study found that “insiders are more likely to engage in open market purchases of their own company stocks when the company is about to reveal new deals with customers and suppliers.”
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Hubbell Insider Transactions in the Past Year
Insider David North had the biggest insider sale in the past 12 months. This one-time transaction involved shares valued at US $ 5.9 million priced at US $ 150 each. This means that even when the share price was below the current price of US $ 185, an insider wanted to cash in some shares. We generally consider it negative if insiders sold, especially if they did so below the current price, as this implies that they considered a lower price to be reasonable. While insider selling is not a positive sign, we cannot be sure that this means that insiders think stocks are fully valued, so it is only a weak sign. We note that the biggest single sale was only 27% of David North’s stake.
Hubbell insiders haven’t bought any shares in the past year. Below you can see a visual representation of insider trading (by businesses and individuals) over the past 12 months. If you click on the chart you can see all of the individual trades including the stock price, individual and date!
If you are like me then you do not want to miss it free list of growing companies that insiders buy.
Hubbell insiders sold shares recently
The past three months have seen significant insider sales at Hubbell. In total, insiders sold US $ 322,000 worth of shares during this period, and we did not record any purchases. All in all, that makes us a little cautious, but that’s not the end.
For an ordinary shareholder, it is worth checking out how many shares are owned by company insiders. Strong insider ownership often makes company management more concerned with the interests of shareholders. Hubbell insiders own around $ 59 million in stock. This equates to 0.6% of the business. While this is a high but not exceptional level of insider ownership, it is enough to indicate some alignment between management and small shareholders.
So what do Hubbell insider trading indicate?
Insiders recently sold Hubbell shares, but did not buy any. And even though we look at last year, we haven’t seen any purchases. Insiders own stocks, but we remain fairly cautious given the sales history. We are in no rush to buy! So these insider trading can help us build a thesis on the stock, but it’s also worth knowing the risks this company faces. For example – Hubbell has 2 warning signs we think you should be aware.
Of course Hubbell may not be the best stock to buy. So you might want to see this free collection of high quality companies.
For the purposes of this article, insiders are the persons who report their transactions to the relevant regulatory body. We currently account for open market transactions and private assignments, but not derivative transactions.
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This Simply Wall St article is general in nature. It does not constitute a recommendation to buy or sell shares and does not take into account your goals or your financial situation. Our aim is to bring you long-term, targeted analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price sensitive companies or qualitative documents. Simply Wall St has no position in the mentioned stocks.
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