Even if it's not a huge purchase, we think it was good to see that Robert Wright, the President of Potbelly Corporation (NASDAQ:PBPB) recently shelled out US$100k to buy stock, at US$5.56 per share. Although the purchase is not a big one, increasing their shareholding by only 3.5%, it can be interpreted as a good sign.
Potbelly Insider Transactions Over The Last Year
Notably, that recent purchase by Robert Wright is the biggest insider purchase of Potbelly shares that we've seen in the last year. That means that an insider was happy to buy shares at around the current price of US$5.80. 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. The good news for Potbelly share holders is that insiders were buying at near the current price.
While Potbelly insiders bought shares during the last year, they didn't sell. The chart below shows insider transactions (by companies and individuals) over the last year. 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.
Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. Potbelly insiders own about US$30m worth of shares. That equates to 18% of the company. 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 Potbelly Tell Us?
The recent insider purchases are heartening. And the longer term insider transactions also give us confidence. But on the other hand, the company made a loss during the last year, which makes us a little cautious. When combined with notable insider ownership, these factors suggest Potbelly insiders are well aligned, and that they may think the share price is too low. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Potbelly. For example, Potbelly has 2 warning signs (and 1 which is a bit unpleasant) we think you should know about.
Of course Potbelly 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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