Vestis Insiders Added US$649.1k Of Stock To Their Holdings

It is usually uneventful when a single insider buys stock. However, When quite a few insiders buy shares, as it happened in Vestis Corporation's (NYSE:VSTS) case, it's fantastic news for shareholders.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

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The Last 12 Months Of Insider Transactions At Vestis

Over the last year, we can see that the biggest insider purchase was by Lead Independent Director Douglas Pertz for US$432k worth of shares, at about US$6.17 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$4.26). While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. To us, it's very important to consider the price insiders pay for shares. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.

While Vestis 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!

Vestis is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.

Does Vestis Boast High Insider Ownership?

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. Based on our data, Vestis insiders have about 0.6% of the stock, worth approximately US$3.7m. We prefer to see high levels of insider ownership.

So What Do The Vestis Insider Transactions Indicate?

The fact that there have been no Vestis insider transactions recently certainly doesn't bother us. But insiders have shown more of an appetite for the stock, over the last year. We'd like to see bigger individual holdings. However, we don't see anything to make us think Vestis insiders are doubting the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Vestis. Case in point: We've spotted 1 warning sign for Vestis you should be aware of.

But note: Vestis 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.

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 of direct interests only, but not derivative transactions or indirect interests.

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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.