We’d be surprised if Universal Corporation (NYSE:UVV) shareholders haven’t noticed that the VP, General Counsel & Secretary, Preston Wigner, recently sold US$159k worth of stock at US$53.00 per share. The eyebrow raising move amounted to a reduction of 10% in their holding.
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Universal Insider Transactions Over The Last Year
The Executive VP & Sales Director of Universal Leaf Tobacco Company Inc, Theodore Broome, made the biggest insider sale in the last 12 months. That single transaction was for US$267k worth of shares at a price of US$53.45 each. So what is clear is that an insider saw fit to sell at around the current price of US$51.12. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. We note that this sale took place at around the current price, so it isn’t a major concern, though it’s hardly a good sign.
Insiders in Universal didn’t buy any shares in the last year. 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!
If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: insiders have been buying them).
Insider Ownership Of Universal
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Universal insiders own about US$22m worth of shares. That equates to 1.8% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
What Might The Insider Transactions At Universal Tell Us?
An insider hasn’t bought Universal stock in the last three months, but there was some selling. Looking to the last twelve months, our data doesn’t show any insider buying. But since Universal is profitable and growing, we’re not too worried by this. Insiders own shares, but we’re still pretty cautious, given the history of sales. We’d practice some caution before buying! While we like knowing what’s going on with the insider’s ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. To help with this, we’ve discovered 4 warning signs (2 don’t sit too well with us!) that you ought to be aware of before buying any shares in Universal.
Of course Universal 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.