Have Insiders Been Selling Wingstop Inc. (NASDAQ:WING) Shares This Year?
We’ve lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So shareholders might well want to know whether insiders have been buying or selling shares in Wingstop Inc. (NASDAQ:WING).
What Is Insider Buying?
It’s quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, such insiders must disclose their trading activities, and not trade on inside information.
Insider transactions are not the most important thing when it comes to long-term investing. But it is perfectly logical to keep tabs on what insiders are doing. As Peter Lynch said, ‘insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.’
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Wingstop Insider Transactions Over The Last Year
In the last twelve months, the biggest single sale by an insider was when Chairman Charles Morrison sold US$1.0m worth of shares at a price of US$60.13 per share. So it’s clear an insider wanted to take some cash off the table, even below the current price of US$67.18. Even though it doesn’t necessarily mean anything, that’s certainly not a positive sign, in our book. As a general rule we consider it to be discouraging when insiders are selling below the current price. Please note, however, that this single sale was just 13.5% of Charles Morrison’s stake.
In the last twelve months insiders netted US$2.6m for 49.23k shares sold. All up, insiders sold more shares in Wingstop than they bought, over the last year. The sellers received a price of around US$53.80, on average. It’s not ideal to see that insiders have sold at around the current price. Since insiders sell for many reasons, we wouldn’t put too much weight on it. You can see a visual depiction of insider transactions (by 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!
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
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. Insiders own 1.0% of Wingstop shares, worth about US$18m. We’ve certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
So What Does This Data Suggest About Wingstop Insiders?
It doesn’t really mean much that no insider has traded Wingstop shares in the last quarter. Still, the insider transactions at Wingstop in the last 12 months are not very heartening. But it’s good to see that insiders own shares in the company. Of course, the future is what matters most. So if you are interested in Wingstop, you should check out this free report on analyst forecasts for the company.
But note: Wingstop may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
