Even if it’s not a huge purchase, we think it was good to see that Enrique Lores, the Independent Director of PayPal Holdings, Inc. (NASDAQ:PYPL) recently shelled out US$97k to buy stock, at US$88.13 per share. That purchase might not be huge but it did increase their holding by 27%.
PayPal Holdings Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when Independent Chairman of the Board John Donahoe bought US$2.0m worth of shares at a price of US$204 per share. So it’s clear an insider wanted to buy, even at a higher price than the current share price (being US$81.68). While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company’s future. In our view, the price an insider pays for shares is very important. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.
In the last twelve months PayPal Holdings insiders were buying shares, but not selling. The average buy price was around US$146. I’d consider this a positive as it suggests insiders see value at around the current price. 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!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
Does PayPal Holdings Boast High Insider Ownership?
Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. It’s great to see that PayPal Holdings insiders own 0.1% of the company, worth about US$116m. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
So What Does This Data Suggest About PayPal Holdings Insiders?
The recent insider purchases are heartening. And an analysis of the transactions over the last year also gives us confidence. When combined with notable insider ownership, these factors suggest PayPal Holdings insiders are well aligned, and quite possibly think the share price is too low. Nice! So while it’s helpful to know what insiders are doing in terms of buying or selling, it’s also helpful to know the risks that a particular company is facing. At Simply Wall St, we found 2 warning signs for PayPal Holdings that deserve your attention before buying any shares.
But note: PayPal Holdings may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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, but not derivative transactions.
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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.