We wouldn't blame FormFactor, Inc. (NASDAQ:FORM) shareholders if they were a little worried about the fact that Kelley Steven-Waiss, the Independent Director recently netted about US$678k selling shares at an average price of US$126. That sale reduced their total holding by 18% which is hardly insignificant, but far from the worst we've seen.

The Last 12 Months Of Insider Transactions At FormFactor

Over the last year, we can see that the biggest insider sale was by the Independent Director, Sheri Rhodes, for US$707k worth of shares, at about US$92.61 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of US$129. We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. We note that the biggest single sale was 67% of Sheri Rhodes's holding.

FormFactor insiders didn't buy any shares 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 click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

If you are like me, then you will not want to miss this free list of small cap stocks that are not only being bought by insiders but also have attractive valuations.

Insider Ownership

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. I reckon it's a good sign if insiders own a significant number of shares in the company. It appears that FormFactor insiders own 0.7% of the company, worth about US$72m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Does This Data Suggest About FormFactor Insiders?

Insiders haven't bought FormFactor stock in the last three months, but there was some selling. And there weren't any purchases to give us comfort, over the last year. On the plus side, FormFactor makes money, and is growing profits. While insiders do own shares, they don't own a heap, and they have been selling. We'd practice some caution before buying! So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing.

Of course FormFactor 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.

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.