Grocery Outlet Holding Corp. (NASDAQ:GO) shareholders (or potential shareholders) will be happy to see that the Lead Independent Director, Erik Ragatz, recently bought a whopping US$2.0m worth of stock, at a price of US$18.25. Not only is that a big swing, but it increased their holding size by 21%, which is definitely great to see.

View our latest analysis for Grocery Outlet Holding

Grocery Outlet Holding Insider Transactions Over The Last Year

In fact, the recent purchase by Lead Independent Director Erik Ragatz was not their only acquisition of Grocery Outlet Holding shares this year. Earlier in the year, they paid US$20.91 per share in a US$2.1m purchase. That means that an insider was happy to buy shares at above the current price of US$18.63. 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. To us, it's very important to consider the price insiders pay for shares. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.

In the last twelve months insiders purchased 256.50k shares for US$5.3m. But insiders sold 169.06k shares worth US$4.5m. In total, Grocery Outlet Holding 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. By clicking on the graph below, you can see the precise details of each insider transaction!

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).

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. We usually like to see fairly high levels of insider ownership. It appears that Grocery Outlet Holding insiders own 3.9% of the company, worth about US$70m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Does This Data Suggest About Grocery Outlet Holding Insiders?

The recent insider purchase is heartening. And the longer term insider transactions also give us confidence. Given that insiders also own a fair bit of Grocery Outlet Holding we think they are probably pretty confident of a bright future. 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. Case in point: We've spotted 1 warning sign for Grocery Outlet Holding you should be aware of.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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 of direct interests only, but not derivative transactions or indirect interests.

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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.