last week, Weis Markets, Inc. (NYSE:WMK) insiders, who had purchased shares in the previous 12 months were rewarded handsomely. The shares increased by 10% last week, resulting in a US$226m increase in the company’s market worth. In other words, the original US$189k purchase is now worth US$283k.
Although we don’t think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.
Our analysis indicates that WMK is potentially overvalued!
The Last 12 Months Of Insider Transactions At Weis Markets
The Senior VP Michael Lockard made the biggest insider purchase in the last 12 months. That single transaction was for US$183k worth of shares at a price of US$61.00 each. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of US$91.34. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn’t tell us much about what they think of current prices.
While Weis Markets insiders bought shares during the last year, they didn’t sell. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!
Weis Markets is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivized to build the company for the long term. Weis Markets insiders own 39% of the company, currently worth about US$968m based on the recent share price. Most shareholders would be happy to this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders see.
So What Do The Weis Markets Insider Transactions Indicate?
It doesn’t really mean much that no insider has traded Weis Markets shares in the last quarter. On a brighter note, the transactions over the last year are encouraging. With high insider ownership and encouraging transactions, it seems like Weis Markets insiders think the business has merit. I like to dive deeper into how a company has performed in the past. You can access this interactive graph of past earnings, revenue and cash flow for free.
of course Weis Markets may not be the best stock to buy. So you may wish to see this free collection of high quality 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, but not derivative transactions.
Valuation is complex, but we’re helping make it simple.
Find out whether Weis Markets is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.
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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.