Potential FreightCar America, Inc. (NASDAQ:RAIL) shareholders may wish to note that the Executive Chairman of the Board, James Meyer, recently bought US$251k worth of stock, paying US$10.74 for each share. While that's a very decent purchase to our minds, it was proportionally a bit modest, boosting their holding by just 2.8%.
FreightCar America Insider Transactions Over The Last Year
In fact, the recent purchase by James Meyer was the biggest purchase of FreightCar America shares made by an insider individual in the last twelve months, according to our records. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$10.51). It's very possible they regret the purchase, but it's more likely they are bullish about the company. We always take careful note of the price insiders pay when purchasing shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.
Over the last year, we can see that insiders have bought 60.80k shares worth US$403k. On the other hand they divested 32.50k shares, for US$270k. Overall, FreightCar America insiders were net buyers during the last year. The average buy price was around US$6.62. We don't deny that it is nice to see insiders buying stock in the company. However, we do note that they were buying at significantly lower prices than today's share price. 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!
FreightCar America is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.
Insider Ownership Of FreightCar America
Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 14% of FreightCar America shares, worth about US$28m. 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 FreightCar America Tell Us?
We note that there's been a little more insider selling than buying, recently. But the net divestment is not enough to concern us at all. But insiders have shown more of an appetite for the stock, over the last year. Insiders own shares in FreightCar America and we see no evidence to suggest they are worried about the future. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. To help with this, we've discovered 4 warning signs (2 can't be ignored!) that you ought to be aware of before buying any shares in FreightCar America.
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.
