Even if it's not a huge purchase, we think it was good to see that Steven Macicek, the Independent Director of American Vanguard Corporation (NYSE:AVD) recently shelled out US$72k to buy stock, at US$5.97 per share. Even though that isn't a massive buy, it did increase their holding by 62%, which is arguably a good sign.

The Last 12 Months Of Insider Transactions At American Vanguard

The Chairman, Eric Wintemute, made the biggest insider sale in the last 12 months. That single transaction was for US$572k worth of shares at a price of US$5.75 each. So it's clear an insider wanted to take some cash off the table, even below the current price of US$6.35. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. This single sale was just 10% of Eric Wintemute's stake.

Over the last year, we can see that insiders have bought 51.20k shares worth US$436k. But insiders sold 105.00k shares worth US$601k. All up, insiders sold more shares in American Vanguard than they bought, over 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: Most of them are flying under the radar).

Does American Vanguard Boast High Insider Ownership?

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that American Vanguard insiders own 6.2% of the company, worth about US$11m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

What Might The Insider Transactions At American Vanguard Tell Us?

Unfortunately, there has been more insider selling of American Vanguard stock, than buying, in the last three months. Zooming out, the longer term picture doesn't give us much comfort. Insiders own shares, but we're still pretty cautious, given the history of sales. So we'd only buy after careful consideration. 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. In terms of investment risks, we've identified 3 warning signs with American Vanguard and understanding these should be part of your investment process.

Of course American Vanguard 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 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.