Insiders At NVR Sold US$31m In Stock, Alluding To Potential Weakness

NVR, Inc. -1.35% Pre

NVR, Inc.

NVR

7657.00

7657.00

-1.35%

0.00% Pre

The fact that multiple NVR, Inc. (NYSE:NVR) insiders offloaded a considerable amount of shares over the past year could have raised some eyebrows amongst investors. When evaluating insider transactions, knowing whether insiders are buying versus if they selling is usually more beneficial, as the latter can be open to many interpretations. However, if numerous insiders are selling, shareholders should investigate more.

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.

Check out our latest analysis for NVR

The Last 12 Months Of Insider Transactions At NVR

Over the last year, we can see that the biggest insider sale was by the Senior VP, Daniel Malzahn, for US$12m worth of shares, at about US$5,924 per share. That means that an insider was selling shares at slightly below the current price (US$6,982). When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. This single sale was just 16% of Daniel Malzahn's stake.

Insiders in NVR didn't buy any shares in the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

insider-trading-volume
NYSE:NVR Insider Trading Volume December 29th 2023

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: insiders have been buying them).

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. We usually like to see fairly high levels of insider ownership. It's great to see that NVR insiders own 1.0% of the company, worth about US$218m. 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 NVR Insider Transactions Indicate?

The fact that there have been no NVR insider transactions recently certainly doesn't bother us. It's heartening that insiders own plenty of stock, but we'd like to see more insider buying, since the last year of NVR insider transactions don't fill us with confidence. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing NVR. To assist with this, we've discovered 1 warning sign that you should run your eye over to get a better picture of NVR.

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.

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