Finance

What the Insider Data Suggests About RH (RH)

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

Institutions own 123.65% of RH (RH)’s shares. The total value of these holdings, in millions, is $2,340. Among active positions in the latest quarter, 113 holders increased their positions by a total of 5.99 million shares, 96 holders decreased the positions by a total of 6.55 million shares, and 30 holders held their positions. This works out to a net decrease in ownership of 560733 shares, and suggests that institutions are feeling bearish about the stock.

Among new and sold out positions, 56 holders initiated new positions by a total of 1.37 million shares and 27 holders exited their positions by a total of 847056 shares. This nets out to an increase of 525364 shares and is a bullish sign for RH.

In the last three months, insiders executed a total of 4 trades. 1 of these were buys and 3 were sells. Insider ownership decreased by a total of 11955 shares, which suggests that RH’s key executives are feeling less optimistic about the outlook for the stock. The data from the past twelve months tells a similar story: insiders executed 10 buys and 6 sells, and ownership decreased by a net of 8445 shares.



Comparing the number of shares sold short over time is a method analysts often use to get a reading on investor sentiment. RH (NYSE:RH)’s short interest is 7.14 million shares, or 44.54% of the float. This represents an increase of 6% 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 RH. A composite of 13 technical indicators that includes measures such as moving averages and momentum oscillators suggests that RH is a hold, which implies that RH is expected to perform in line with 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 RH (NYSE:RH) is fairly valued.

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