Investors who take an interest in Installed Building Products, Inc. (NYSE:IBP) should definitely note that the CFO, Executive VP of Finance & Director, Michael Miller, recently paid US$208 per share to buy US$499k worth of the stock. Although the purchase only increased their holding by 4.2%, it is still a solid purchase in our view.

Installed Building Products Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the Chairman, Jeffrey Edwards, sold US$126m worth of shares at a price of US$314 per share. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. It's of some comfort that this sale was conducted at a price well above the current share price, which is US$206. So it may not tell us anything about how insiders feel about the current share price.

Over the last year, we can see that insiders have bought 6.80k shares worth US$1.3m. But they sold 422.07k shares for US$132m. All up, insiders sold more shares in Installed Building Products than they bought, over the last year. The average sell price was around US$312. It is certainly not great to see that insiders have sold shares in the company. But we note that the selling, on average, was at well above the recently traded price of US$206. 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!

I will like Installed Building Products better if I see some big insider buys.

Insider Ownership

Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. It's great to see that Installed Building Products insiders own 14% of the company, worth about US$750m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Do The Installed Building Products Insider Transactions Indicate?

Unfortunately, there has been more insider selling of Installed Building Products stock, than buying, in the last three months. And our longer term analysis of insider transactions didn't bring confidence, either. But since Installed Building Products is profitable and growing, we're not too worried by this. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about 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. To assist with this, we've discovered 2 warning signs that you should run your eye over to get a better picture of Installed Building Products.

But note: Installed Building Products 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.

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.