Market Overview

Insider Buys Agree Realty Stock

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A Form 4 filing filed with the SEC on Monday, October 26 showed that President & CEO Agree Joey bought 7,235 shares of Agree Realty Inc (NYSE:ADC) at $65.58 on Thursday, Oct 22, and bought 8,058 shares at $65.79 on Friday, Oct 23.The transaction moved the executive's stake in Agree Realty Inc. to 380,462 shares. Agree Realty was trading 1.5% lower from the previous closing price.

The Importance of Insider Transactions

While transactions from an insider shouldn't be used as the sole item to make an investment or trading decision, an insider buying or selling stock in their company can be a good added factor that leads to more conviction in a decision.

When an insider buys stock after an important sell off, that can indicate the insider's faith in the success of the organization. Henceforth, if the stock is bought at new highs, it might be because the insider feels that the stock is not overvalued. Conversely, insiders who are selling stock at new lows can potentially indicate some kind of capitulation moment. Insiders selling at new highs can indicate that exec wants to "take some profit" and "lock in a gain."

Important Transaction Codes

Wall Street tends to focus on insider transactions which take place in the open market, viewed inside a Form 4 filing via codes P for purchase and S for sale. If the transaction was an open-market transaction, that means that the insider made a concious decision for the company's stock moving forward.

Transaction codes besides P or S aren't relatively important as they are seldom tied to a decision by the executive. For example, transaction code A is indicative of an insider being forced to sell shares to attain compensation. Moreover, transaction code C indicates the conversion of an option.

 

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