Insiders Of Intrepid Potash Retain US$8.2m Of Investment Selling At Higher Prices

Despite a 13% gain in Intrepid Potash, Inc.'s (NYSE:IPI) stock price this week, shareholders shouldn't let up. Even though stock prices were relatively low, insiders elected to sell US$8.2m worth of stock in the last year, which could indicate some expected downturn.

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

View our latest analysis for Intrepid Potash

Intrepid Potash Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the insider, Robert Jornayvaz, for US$6.2m worth of shares, at about US$26.24 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of US$29.18. 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. 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. It is worth noting that this sale was 66% of Robert Jornayvaz's holding. Robert Jornayvaz was the only individual insider to sell shares in the last twelve months.

Robert Jornayvaz divested 320.00k shares over the last 12 months at an average price of US$25.50. 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!

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

Insiders At Intrepid Potash Have Sold Stock Recently

The last three months saw significant insider selling at Intrepid Potash. Specifically, insider Robert Jornayvaz ditched US$1.9m worth of shares in that time, and we didn't record any purchases whatsoever. Overall this makes us a bit cautious, but it's not the be all and end all.

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. Our data indicates that Intrepid Potash insiders own about US$9.7m worth of shares (which is 3.0% of the company). However, it's possible that insiders might have an indirect interest through a more complex structure. Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!

So What Does This Data Suggest About Intrepid Potash Insiders?

An insider hasn't bought Intrepid Potash stock in the last three months, but there was some selling. Looking to the last twelve months, our data doesn't show any insider buying. When you combine this with the relatively low insider ownership, we are very cautious about the stock. So we'd only buy after very careful consideration. 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. Be aware that Intrepid Potash is showing 2 warning signs in our investment analysis, and 1 of those makes us a bit uncomfortable...

Of course Intrepid Potash 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.

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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.