As Encompass Health Corporation (NYSE: EHC)) market cap fell by $ 282 million, insiders who sold $ 1.2 million of shares were able to make up for their losses


Insiders appear to have made the most of their holdings by selling for $ 1.2 million Encompass health company (NYSE: EHC) at an average selling price of $ 78.70 over the past year. After the stock price fell 3.8% last week, the company’s market value fell $ 282 million, but insiders were able to mitigate their losses.

While we don’t think shareholders should just follow insider trading, we think it makes perfect sense to keep tabs on what insiders are doing.

Encompass health insider trading in the past year

Over the past year, we can see that the biggest insider sale was made by Senior Vice President and Chief Accounting Officer Andrew Price for US $ 699,000 of shares, at around 81.40 US $ per share. While insider selling is negative, for us it is even more negative if stocks are sold for a lower price. The good news is that this big sale was well above the current price of US $ 71.05. So it might not shed much light on insider confidence at current levels.

In the past year, Insiders of Encompass Health have not bought any shares in the company. You can see insider trading (by companies and individuals) over the past year shown in the graph below. By clicking on the graph below, you can see the precise detail of each insider trade!

NYSE: EHC Insider Trading Volume October 9, 2021

I will like Encompass Health better if I see large insider buys. In the meantime, watch this free list of growing companies with significant and recent insider buying.

Insider Property of Encompass Health

Another way to test the alignment between a company’s executives 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 have an incentive to build the business for the long term. It’s great to see that Encompass Health insiders own 2.3% of the company, worth around $ 160 million. Most shareholders would be happy to see this type of insider ownership, as it suggests that management’s incentives are well aligned with those of other shareholders.

So what does this data suggest about Encompass Health Insiders?

There haven’t been any insider trading in the past three months, that doesn’t mean much. While we’re happy with Encompass Health’s high insider ownership, we can’t say the same for the sale of shares. In addition to knowing what insider trading is going on, it helps to identify the risks Encompass Health faces. Concrete example: we have spotted 2 warning signs for Encompass Health you must be aware.

Sure, you might find a fantastic investment looking elsewhere. So take a look at this free list of interesting companies.

For the purposes of this article, insiders are the persons who report their transactions to the relevant regulatory body. We currently account for open market transactions and private assignments, but not derivative transactions.

This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts using only unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell shares and does not take into account your goals or your financial situation. Our aim is to bring you long-term, targeted analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price sensitive companies or qualitative documents. Simply Wall St has no position in any of the stocks mentioned.

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