This Insider Has Just Sold Shares In RH

Restoration Hardware Holdings, Inc. -1.99%

Restoration Hardware Holdings, Inc.

RH

240.41

-1.99%

We'd be surprised if RH (NYSE:RH) shareholders haven't noticed that the Director, Keith Belling, recently sold US$153k worth of stock at US$306 per share. However, the silver lining is that the sale only reduced their total holding by 8.4%, so we're hesitant to read anything much into it, on its own.

See our latest analysis for RH

The Last 12 Months Of Insider Transactions At RH

The Independent Director, Carlos Alberini, made the biggest insider sale in the last 12 months. That single transaction was for US$7.8m worth of shares at a price of US$315 each. So we know that an insider sold shares at around the present share price of US$299. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. In this case, the big sale took place at around the current price, so it's not too bad (but it's still not a positive).

RH insiders didn't buy any shares over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

insider-trading-volume
NYSE:RH Insider Trading Volume December 28th 2023

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

Does RH Boast High Insider Ownership?

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with 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. RH insiders own about US$1.0b worth of shares (which is 19% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Do The RH Insider Transactions Indicate?

An insider sold stock recently, but they haven't been buying. And there weren't any purchases to give us comfort, over the last year. It is good to see high insider ownership, but the insider selling leaves us cautious. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing RH. For example, RH has 3 warning signs (and 2 which don't sit too well with us) 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.

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