Finance

Dissecting the Insider Trading Patterns of VEREIT, Inc. (VER)

Recent insider trends for VEREIT, Inc. (NYSE:VER) have caught the attention of investors. Analysts monitor insider data to understand the sentiment of a company’s largest and most important shareholders. VER’s insider trading patterns have some implications for where the stock might be headed.

Institutions own 86.25% of VEREIT, Inc. (VER)’s shares. The total value of these holdings, in millions, is $6,512. Among active positions in the latest quarter, 187 holders increased their positions by a total of 68.29 million shares, 169 holders decreased the positions by a total of 70.53 million shares, and 59 holders held their positions. This works out to a net decrease in ownership of 2.24 million shares, and suggests that institutions are feeling bearish about the stock.

Among new and sold out positions, 38 holders initiated new positions by a total of 9.13 million shares and 42 holders exited their positions by a total of 3.77 million shares. This nets out to an increase of 5.36 million shares and is a bullish sign for VER.

In the last three months, insiders executed a total of 6 trades. 4 of these were buys and 2 were sells. Insider ownership decreased by a total of 18857 shares, which suggests that VER’s key executives are feeling less optimistic about the outlook for the stock. The data from the past twelve months tells a different story: insiders executed 32 buys and 14 sells, and ownership increased by a net of 1.21 million shares.



Short interest is another tool that analysts use to gauge investor sentiment. It represents the number of a stock’s shares that are being shorted by investors. VEREIT, Inc. (NYSE:VER)’s short interest is 23.09 million shares, or % of the float. This represents an increase of 11% in the number of shares being shorted compared to the previous reading, and implies that investors felt more pessimistic about the stock during the past two weeks.

In light of the insider ownership and trading data it makes sense to consider technicals to see if they come to a similar conclusion about the outlook for VER. A composite of 13 technical indicators that includes measures such as moving averages and momentum oscillators suggests that VER is a Strong sell, which implies that VER is expected to underperform the market based on prior trading patterns.

Conclusion




Institutional ownership trends suggest that the stock is cheap and the insider trading data indicates that insiders are bearish. Technical indicators (also) suggest that VEREIT, Inc. (NYSE:VER) is overvalued.

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