While Huckleberry.ai, Inc. (NASDAQ:HUCK) shareholders have had a good week with the stock up 14%, they shouldn't let their guards down. Although prices were relatively low, insiders chose to sell US$557k worth of stock in the past 12 months. This could be a sign of impending weakness.
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.
The Last 12 Months Of Insider Transactions At Huckleberry.ai
In the last twelve months, the biggest single sale by an insider was when the Founder, Joshua James, sold US$228k worth of shares at a price of US$2.38 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of US$3.43. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. This single sale was just 4.2% of Joshua James's stake.
Huckleberry.ai insiders didn't buy any shares 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 click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Check out our latest analysis for Huckleberry.ai
I will like Huckleberry.ai better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.
Insiders At Huckleberry.ai Have Sold Stock Recently
We have seen a bit of insider selling at Huckleberry.ai, over the last three months. Director David Jolley divested only US$41k worth of shares in that time. Neither the lack of buying nor the presence of selling is heartening. But the volume sold is so low that it really doesn't bother us.
Insider Ownership Of Huckleberry.ai
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. Insiders own 16% of Huckleberry.ai shares, worth about US$22m. 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 Huckleberry.ai Insider Transactions Indicate?
We did not see any insider buying in the last three months, but we did see selling. However, the sales are not big enough to concern us at all. Recent insider selling makes us a little nervous, in light of the broader picture of Huckleberry.ai insider transactions. But we do like the fact that insiders own a fair chunk of the company. 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. Our analysis shows 3 warning signs for Huckleberry.ai (2 are concerning!) and we strongly recommend you look at them before investing.
Of course Huckleberry.ai 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 of direct interests only, but not derivative transactions or indirect interests.
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