Even though America’s Car-Mart, Inc. (NASDAQ:CRMT) has fallen by 16% over the past week , insiders who sold US$8.3m worth of stock over the past year have had less luck. Insiders might have been better off holding onto their shares, given that the average selling price of US$120 is still below the current share price.

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.

See our latest analysis for America’s Car-Mart

The Last 12 Months Of Insider Transactions At America’s Car-Mart

The insider, Adam Peterson, made the biggest insider sale in the last 12 months. That single transaction was for US$8.3m worth of shares at a price of US$125 each. While we don’t usually like to see insider selling, it’s more concerning if the sales take place at a lower price. The silver lining is that this sell-down took place above the latest price (US$66.29). So it may not tell us anything about how insiders feel about the current share price. The only individual insider seller over the last year was Adam Peterson. Notably Adam Peterson was also the biggest buyer, having purchased US$5.2m worth of shares.

You can see the insider transactions (by companies and individuals) over the last year depicted in the chart 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 winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 6.0% of America’s Car-Mart shares, worth about US$31m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

What Might The Insider Transactions At America’s Car-Mart Tell Us?

There haven’t been any insider transactions in the last three months — that doesn’t mean much. We don’t take much encouragement from the transactions by America’s Car-Mart insiders. But we do like the fact that insiders own a fair chunk of the company. So these insider transactions can help us build a thesis about the stock, but it’s also worthwhile knowing the risks facing this company. In terms of investment risks, we’ve identified 1 warning sign with America’s Car-Mart and understanding it should be part of your investment process.

Of course America’s Car-Mart 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.