Benzinga | Mar 19, 2021 12:49PM EDT

Insider Buys comScore Shares



comScore Inc (NASDAQ:SCOR) was trading 10% higher from the previous closing price. Livek William Paul filed a Form 4 with the SEC on Friday, March 19. The insider bought 116,987 shares at $3.61 on Wednesday, Mar 17, and bought 83,013 shares at $3.73 on Thursday, Mar 18. After the transactions, the executive's stake in comScore Inc. moved to 911,149 shares.

Why Insider Transactions Are Important?

Insider transactions shouldn't be used primarily to make an investing decision, however an insider transaction can be an important factor in the investing decision.

Insiders buying stock after a notable sell off can indicate an insider's long-term belief in the success of the company; insiders buying stock at new highs can be an indication the exec doesn't feel the stock is overvalued. Insiders who sell stock at new lows could be anticipating some capitulation moment. If the insider sells at new highs, it could point to the intention to "take some profit" and "lock in a gain."

Transaction Codes To Focus On

Investors prefer focusing on transactions which take place in the open market, indicated in the Form 4 with codes P for purchase and S for sale. An open-market transaction means the insider went into the market of their own volition and made an active decision about the potential path for a company and its stock moving forward.

Transaction codes other than P or S are often viewed with less conviction as they are often not tied to a decision by the exec. As an example, transaction code C indicates the conversion of an option. Transaction code A indicates the insider may have been forced to sell shares in order to receive compensation the exec was promised upon being hired by a company.