Finance

Are Chico’s FAS, Inc. (CHS)’s Recent Ownership and Insider Trends a Sign of Things to Come?

Recent insider trends for Chico’s FAS, Inc. (NYSE:CHS) have caught the attention of investors. Patters in insider activity can help analysts formulate an outlook for a stock. In the case of CHS, the data has a lot to say about how the stock might perform going forward.

Institutions own 103.95% of Chico’s FAS, Inc. (CHS)’s shares. The total value of these holdings, in millions, is $1,063. Among active positions in the latest quarter, 136 holders increased their positions by a total of 20.71 million shares, 108 holders decreased the positions by a total of 19.84 million shares, and 28 holders held their positions. This works out to a net increase in ownership of 862606 shares, and suggests that institutions are feeling bullish about the stock.

Among new and sold out positions, 36 holders initiated new positions by a total of 2.77 million shares and 41 holders exited their positions by a total of 8.23 million shares. This nets out to a decrease of 5.46 million shares and is another bearish sign for CHS.

In the last three months, insiders executed a total of 2 trades. 1 of these were buys and 1 were sells. Insider ownership increased by a total of 22270 shares, which suggests that CHS’s key executives are feeling more optimistic about the outlook for the stock. The data from the past twelve months tells a similar story: insiders executed 21 buys and 30 sells, and ownership increased by a net of 657121 shares.



The analysis of insider buying and selling trends can be extended to the aggregate level. Short interest, which represents the number of a stock’s shares currently being shorted, captures what the market as a whole feels about a stock. Chico’s FAS, Inc. (NYSE:CHS)’s short interest is 17.96 million shares, or 14.79% of the float. This represents a decrease of -19% in the number of shares being shorted compared to the previous reading, and implies that investors felt less pessimistic about the stock during the past two weeks.

Insider data can help an investor form an outlook on a stock, but it’s important to supplement this data with other information such as technical indicators to form a more complete view. A composite of 13 technical indicators that includes measures such as moving averages and momentum oscillators suggests that CHS is a Strong sell, which implies that CHS 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 bullish. Technical indicators (also) suggest that Chico’s FAS, Inc. (NYSE:CHS) is overvalued.

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