Lead Independent Director Jeffrey Brown Just Bought 515% More Shares In Medifast, Inc. (NYSE:MED)

Investors who take an interest in Medifast, Inc. (NYSE:MED) should definitely note that the Lead Independent Director, Jeffrey Brown, recently paid US$127 per share to buy US$499k worth of the stock. We reckon that's a good sign, especially since the purchase boosted their holding by 515%.

View our latest analysis for Medifast

The Last 12 Months Of Insider Transactions At Medifast

Notably, that recent purchase by Jeffrey Brown is the biggest insider purchase of Medifast shares that we've seen in the last year. So it's clear an insider wanted to buy, at around the current price, which is US$137. Of course they may have changed their mind. But this suggests they are optimistic. While we always like to see insider buying, it's less meaningful if the purchases were made at much lower prices, as the opportunity they saw may have passed. In this case we're pleased to report that the insider purchases were made at close to current prices.

In the last twelve months insiders purchased 5.06k shares for US$706k. On the other hand they divested 1.82k shares, for US$350k. In the last twelve months there was more buying than selling by Medifast insiders. The average buy price was around US$140. This is nice to see since it implies that insiders might see value around current prices. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

Medifast is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Insider Ownership Of Medifast

For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that Medifast insiders own 1.8% of the company, worth about US$28m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

What Might The Insider Transactions At Medifast Tell Us?

It is good to see the recent insider purchase. And an analysis of the transactions over the last year also gives us confidence. Given that insiders also own a fair bit of Medifast we think they are probably pretty confident of a bright future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Medifast. In terms of investment risks, we've identified 1 warning sign with Medifast and understanding this should be part of your investment process.

Of course Medifast 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.

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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.

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