20% Of This Advanced Drainage Systems Insider's Holdings Were Sold

Viewing insider transactions for Advanced Drainage Systems, Inc.'s (NYSE:WMS ) over the last year, we see that insiders were net sellers. This means that a larger number of shares were sold by insiders in relation to shares purchased.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.

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Advanced Drainage Systems Insider Transactions Over The Last Year

In fact, the recent sale by Darin Harvey was the biggest sale of Advanced Drainage Systems shares made by an insider individual in the last twelve months, according to our records. So we know that an insider sold shares at around the present share price of US$116. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. We note that this sale took place at around the current price, so it isn't a major concern, though it's hardly a good sign.

Darin Harvey sold a total of 5.44k shares over the year at an average price of US$118. 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!

View our latest analysis for Advanced Drainage Systems

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Insiders At Advanced Drainage Systems Have Sold Stock Recently

The last quarter saw substantial insider selling of Advanced Drainage Systems shares. In total, Executive Vice President of Supply Chain Darin Harvey sold US$520k worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.

Insider Ownership Of Advanced Drainage Systems

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. I reckon it's a good sign if insiders own a significant number of shares in the company. It's great to see that Advanced Drainage Systems insiders own 1.4% of the company, worth about US$124m. 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 Does This Data Suggest About Advanced Drainage Systems Insiders?

An insider sold Advanced Drainage Systems shares recently, but they didn't buy any. And there weren't any purchases to give us comfort, over the last year. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. In terms of investment risks, we've identified 2 warning signs with Advanced Drainage Systems and understanding these should be part of your investment process.

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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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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.