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In the last year, multiple insiders have substantially increased their holdings of Franklin Resources, Inc. (NYSE:BEN) stock, indicating that insiders' optimism about the company's prospects has increased.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
We've discovered 3 warning signs about Franklin Resources. View them for free.
The Last 12 Months Of Insider Transactions At Franklin Resources
In the last twelve months, the biggest single purchase by an insider was when insider Charles Johnson bought US$4.6m worth of shares at a price of US$22.80 per share. That means that even when the share price was higher than US$18.39 (the recent price), an insider wanted to purchase shares. It's very possible they regret the purchase, but it's more likely they are bullish about the company. We always take careful note of the price insiders pay when purchasing shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price. We note that Charles Johnson was both the biggest buyer and the biggest seller.
In the last twelve months insiders purchased 632.02k shares for US$13m. On the other hand they divested 420.00 shares, for US$7.4k. In total, Franklin Resources insiders bought more than they sold over the last year. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
View our latest analysis for Franklin Resources
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).
Insiders At Franklin Resources Have Bought Stock Recently
There has been significantly more insider buying, than selling, at Franklin Resources, over the last three months. In total, insider Charles Johnson bought US$2.0m worth of shares in that time. On the other hand, insider Charles Johnson netted US$7.4k by selling. We think insiders may be optimistic about the future, since insiders have been net buyers of shares.
Does Franklin Resources Boast High Insider Ownership?
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It's great to see that Franklin Resources insiders own 41% of the company, worth about US$3.9b. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.