Generally, when a single insider buys stock, it is usually not a big deal. However, when several insiders are buying, like in the case of Sylvamo Corporation (NYSE:SLVM), it sends a favourable message to the company's shareholders.

Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.

View our latest analysis for Sylvamo

Sylvamo Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the Senior VP & CFO, John Sims, for US$614k worth of shares, at about US$47.81 per share. That means that an insider was selling shares at slightly below the current price (US$50.28). We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. However, while insider selling is sometimes discouraging, it's only a weak signal. This single sale was just 27% of John Sims's stake.

Happily, we note that in the last year insiders paid US$742k for 14.98k shares. But they sold 15.25k shares for US$733k. In the last twelve months there was more buying than selling by Sylvamo insiders. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

Sylvamo is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

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. We usually like to see fairly high levels of insider ownership. It appears that Sylvamo insiders own 0.6% of the company, worth about US$12m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

What Might The Insider Transactions At Sylvamo Tell Us?

There haven't been any insider transactions in the last three months -- that doesn't mean much. On a brighter note, the transactions over the last year are encouraging. Insiders own shares in Sylvamo and we see no evidence to suggest they are worried about the future. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. At Simply Wall St, we've found that Sylvamo has 3 warning signs (1 shouldn't be ignored!) that deserve your attention before going any further with your analysis.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.