Anyone interested in Rocky Brands, Inc. (NASDAQ:RCKY) should probably be aware that the Assistant Secretary & Independent Director, Curtis Loveland, recently divested US$176k worth of shares in the company, at an average price of US$50.54 each. However, the silver lining is that the sale only reduced their total holding by 3.6%, so we're hesitant to read anything much into it, on its own.

Rocky Brands Insider Transactions Over The Last Year

Notably, that recent sale by Assistant Secretary & Independent Director Curtis Loveland was not the only time they sold Rocky Brands shares this year. Earlier in the year, they fetched US$32.43 per share in a -US$303k sale. That means that even when the share price was below the current price of US$49.71, an insider wanted to cash in some shares. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. This single sale was just 9.1% of Curtis Loveland's stake.

All up, insiders sold more shares in Rocky Brands than they bought, over the last year. They sold for an average price of about US$35.78. It's not particularly great to see insiders were selling shares at below recent prices. Since insiders sell for many reasons, we wouldn't put too much weight on it. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

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

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. It appears that Rocky Brands insiders own 6.5% of the company, worth about US$24m. 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 Does This Data Suggest About Rocky Brands Insiders?

Unfortunately, there has been more insider selling of Rocky Brands stock, than buying, in the last three months. Zooming out, the longer term picture doesn't give us much comfort. But it is good to see that Rocky Brands is growing earnings. Insiders own shares, but we're still pretty cautious, given the history of sales. We'd practice some caution before buying! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For example, Rocky Brands has 3 warning signs (and 2 which make us uncomfortable) we think you should know about.

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.

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.