It is not uncommon to see companies perform well in the years after insiders buy shares. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sell Jefferies Financial Group Inc. (NYSE:JEF), you may well want to know whether insiders have been buying or selling.
Do Insider Transactions Matter?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, most countries require that the company discloses such transactions to the market.
We don’t think shareholders should simply follow insider transactions. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Columbia University study found that ‘insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers’.
View our latest analysis for Jefferies Financial Group
The Last 12 Months Of Insider Transactions At Jefferies Financial Group
The President & Director Brian Friedman made the biggest insider purchase in the last 12 months. That single transaction was for US$81k worth of shares at a price of US$16.27 each. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of US$25.10. Because the shares were purchased at a lower price, this particular buy doesn’t tell us much about how insiders feel about the current share price.
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!
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.
Insider Ownership of Jefferies Financial Group
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’s great to see that Jefferies Financial Group insiders own 20% of the company, worth about US$1.2b. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
So What Do The Jefferies Financial Group Insider Transactions Indicate?
The fact that there have been no Jefferies Financial Group insider transactions recently certainly doesn’t bother us. But insiders have shown more of an appetite for the stock, over the last year. Judging from their transactions, and high insider ownership, Jefferies Financial Group insiders feel good about the company’s future. In addition to knowing about insider transactions going on, it’s beneficial to identify the risks facing Jefferies Financial Group. At Simply Wall St, we found 2 warning signs for Jefferies Financial Group that deserve your attention before buying any shares.
Of course Jefferies Financial Group 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. 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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