Denny's Corporation's (NASDAQ:DENN) value has fallen 15% in the last week, but insiders who sold US$1.7m worth of stock over the last year have had less success. Given that the average selling price of US$9.14 is still lower than the current share price, insiders would probably have been better off keeping their shares.

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.

The Last 12 Months Of Insider Transactions At Denny's

Over the last year, we can see that the biggest insider sale was by the Director, John Miller, for US$1.3m worth of shares, at about US$9.36 per share. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. It's of some comfort that this sale was conducted at a price well above the current share price, which is US$5.47. So it is hard to draw any strong conclusion from it.

Over the last year, we can see that insiders have bought 22.00k shares worth US$143k. But insiders sold 184.00k shares worth US$1.7m. In total, Denny's insiders sold more 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 want to know exactly who sold, for how much, and when, simply click on the graph below!

For those who like to find hidden gems this free list of small cap companies with recent insider purchasing, could be just the ticket.

Insider Ownership Of Denny's

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. Denny's insiders own about US$16m worth of shares. That equates to 4.7% of the company. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Do The Denny's Insider Transactions Indicate?

The fact that there have been no Denny's insider transactions recently certainly doesn't bother us. Our analysis of Denny's insider transactions leaves us cautious. But we do like the fact that insiders own a fair chunk of the company. While it's good to be aware of 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. For example, Denny's has 4 warning signs (and 2 which shouldn't be ignored) we think you should know about.

But note: Denny's 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.