Quite a few insiders have dramatically grown their holdings in Snowflake Inc. (NYSE:SNOW) over the past 12 months. An insider's optimism about the company's prospects is a positive sign.

While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

Check out our latest analysis for Snowflake

Snowflake Insider Transactions Over The Last Year

The Lead Independent Director Michael Speiser made the biggest insider purchase in the last 12 months. That single transaction was for US$10.0m worth of shares at a price of US$131 each. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of US$159. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.

Happily, we note that in the last year insiders paid US$15m for 110.77k shares. But they sold 30.40k shares for US$4.5m. In the last twelve months there was more buying than selling by Snowflake insiders. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

Snowflake is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.

Insiders At Snowflake Have Sold Stock Recently

Over the last three months, we've seen significant insider selling at Snowflake. Specifically, Chief Accounting Officer Emily Ho ditched US$597k worth of shares in that time, and we didn't record any purchases whatsoever. Overall this makes us a bit cautious, but it's not the be all and end all.

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. A high insider ownership often makes company leadership more mindful of shareholder interests. It's great to see that Snowflake insiders own 4.4% of the company, worth about US$2.4b. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

What Might The Insider Transactions At Snowflake Tell Us?

An insider sold Snowflake shares recently, but they didn't buy any. On the other hand, the insider transactions over the last year are encouraging. We are also comforted by the high levels of insider ownership. So we're happy to look past recent trading. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. Every company has risks, and we've spotted 2 warning signs for Snowflake (of which 1 is concerning!) you should know about.

Of course Snowflake may not be the best stock to buy. So you may wish to see this free collection of high quality companies.

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.