Over a year, stock sold by the insiders of ALJ Regional Holdings, Inc. (NASDAQ: ALJJ) has raised investors’ concerns. It is an obvious concern that requires shareholders to take a deeper look if many insiders are selling stock within a specific period. But the selling transactions are not sufficiently firm as a signal.
Insiders’ Transactions Over The Last Year
In one year, the CEO and Executive Chairman, Jess Ravich, has made the most significant stock sale worth US$498k, at about US$1.80 per share, that’s above the current price of US$1.24. Thus, it’s not more concerning as the sales took place at a higher price; therefore, it does not show the insiders’ shed confidence at current levels. But, it can also not be ignored that insiders didn’t buy any stock during the past year. Neither insiders’ selling is favorable nor the lack of recent buyers. Over three months, the director sold stock worth just US$12k.
For a shareholder, it is worth being aware of the numbers of stocks held by company insiders. The insiders of the company – ALJ Regional Holdings hold its 43% shares, present worth US$23m. If insiders own a significant number of their company’s stocks, it is a good sign. Thus, such significant ownership by insiders generally signifies that the company is doing good in the interest of shareholders.
What The Data Concludes
The sale of stocks is not big enough to be a concern at all as the shareholders can feel good about the high percentage of ALJ Regional Holdings’ insider ownership. But the same can not be said about the selling of shares despite selling at a higher price. It will be good if insiders show some buys in the ALJ Regional Holdings. Thus, shareholders can determine the risks involved before investing.