Shareholders of Virtu Financial, Inc. (NASDAQ:VIRT) may have reason to feel a bit uneasy following recent insider activity. Brett Fairclough, the Co-President and Co-COO of the company, sold shares worth approximately US$2.7 million at an average price of US$36.84. This significant transaction represents a 45% reduction in his holdings, which is a noteworthy event that deserves attention.
Check out our latest analysis for Virtu Financial
Insight into Insider Transactions at Virtu Financial
The recent sale by Brett Fairclough marks the largest insider transaction observed in the past year at Virtu Financial. Conducted near the current trading price of US$36.77, such sales often raise eyebrows among investors. While insider selling isn’t typically a red flag, the concern grows if these transactions occur at lower prices. Since this sale reflects the current market price, it may not be a pressing issue, but it does warrant caution.
This past year, insiders at Virtu Financial have refrained from purchasing additional stock. A graphical representation of insider transactions from the last twelve months is available for review, showing all individual trades, including specifics about share prices, individuals involved, and transaction dates.
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Examining Insider Ownership at Virtu Financial
To gauge the alignment of interests between a company’s leadership and its shareholders, it’s valuable to assess insider ownership. In the case of Virtu Financial, insiders collectively hold shares valued at approximately US$89 million, representing 1.6% of the company’s total equity. While this level of insider ownership is decent but not exceptional, it indicates some degree of alignment between management and minor shareholders.
What Do Recent Insider Activities Indicate for Virtu Financial?
Over the past three months, there hasn’t been any insider purchasing of Virtu Financial stock, coupled with some selling activity. Extending this observation to the last year, insider purchases appear completely absent. On a positive note, Virtu Financial continues to show growth in its earnings. It is important to note, however, that while insiders do hold shares, their overall ownership is not substantial, and recent selling trends may suggest caution for potential investors. Understanding the risks related to Virtu Financial is also essential, as there is one warning sign to consider.
Conclusion: Are Virtu Financial Stocks Worth the Investment?
In summary, while there are no recent insider purchases at Virtu Financial and some notable sales have occurred, the company’s earnings trajectory is encouraging. The relatively low insider ownership raises questions, especially given the recent selling activity. Potential investors may want to approach Virtu Financial with cautious optimism and consider exploring other investment opportunities. For instance, this free collection of high-quality companies might prove to be more appealing for those seeking robust investment options.
Note: This article considers insiders as individuals required to report their transactions to the relevant regulatory authorities. The accounting includes open market transactions and private disposals of direct interests, excluding derivative or indirect interests.