Quite a few insiders have dramatically grown their holdings in Dollar General Corporation (NYSE:DG) over the past 12 months. An insider’s optimism about the company’s prospects is a positive sign.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.
View our latest analysis for Dollar General
Dollar General Insider Transactions Over The Last Year
The Independent Chairman of the Board Michael Calbert made the biggest insider purchase in the last 12 months. That single transaction was for US$1.3m worth of shares at a price of US$156 each. So it’s clear an insider wanted to buy, even at a higher price than the current share price (being US$153). Their view may have changed since then, but at least it shows they felt optimistic at the time. We always take careful note of the price insiders pay when purchasing shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.
Happily, we note that in the last year insiders paid US$1.9m for 12.97k shares. But insiders sold 5.91k shares worth US$959k. In total, Dollar General insiders bought more than they sold 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!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
Dollar General Insiders Are Selling The Stock
The last quarter saw substantial insider selling of Dollar General shares. Specifically, Executive VP & Chief Information Officer Carman Wenkoff ditched US$959k worth of shares in that time, and we didn’t record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.
Insider Ownership
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It appears that Dollar General insiders own 0.3% of the company, worth about US$99m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
So What Does This Data Suggest About Dollar General Insiders?
An insider hasn’t bought Dollar General stock in the last three months, but there was some selling. On the other hand, the insider transactions over the last year are encouraging. We like that insiders own a fair amount of the company. So the recent selling doesn’t worry us too much. So while it’s helpful to know what insiders are doing in terms of buying or selling, it’s also helpful to know the risks that a particular company is facing. You’d be interested to know, that we found 3 warning signs for Dollar General and we suggest you have a look.
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.
