Insiders who bought Xcel Brands, Inc. (NASDAQ:XELB) in the last 12 months may probably not pay attention to the stock's recent 10.0% drop. After taking the recent loss into consideration, the US$367.5k worth of stock they bought is now worth US$715.4k, indicating that their investment yielded a positive return.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

The Last 12 Months Of Insider Transactions At Xcel Brands

The Chairman Robert D'Loren made the biggest insider purchase in the last 12 months. That single transaction was for US$137k worth of shares at a price of US$1.10 each. We do like to see buying, but this purchase was made at well below the current price of US$1.80. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.

While Xcel Brands insiders bought shares during the last year, they didn't sell. Their average price was about US$0.92. It is certainly positive to see that insiders have invested their own money in the company. However, you should keep in mind that they bought when the share price was meaningfully below today's levels. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).

Insider Ownership

Many investors like to check how much of a company is owned by insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Insiders own 27% of Xcel Brands shares, worth about US$2.9m. 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 Xcel Brands Insiders?

It doesn't really mean much that no insider has traded Xcel Brands shares in the last quarter. On a brighter note, the transactions over the last year are encouraging. Overall we don't see anything to make us think Xcel Brands insiders are doubting the company, and they do own shares. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. To help with this, we've discovered 6 warning signs (2 are significant!) that you ought to be aware of before buying any shares in Xcel Brands.

But note: Xcel Brands 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.