ThredUp Inc. (NASDAQ:TDUP) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 28%, resulting in a US$112m rise in the company's market capitalisation, translating to a gain of 323% on their initial investment. Put another way, the original US$909.0k acquisition is now worth US$3.84m.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.

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The Last 12 Months Of Insider Transactions At ThredUp

In the last twelve months, the biggest single purchase by an insider was when Independent Director Noam Paransky bought US$146k worth of shares at a price of US$0.81 per share. Even though the purchase was made at a significantly lower price than the recent price (US$4.29), we still think insider buying is a positive. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.

In the last twelve months insiders purchased 895.75k shares for US$909k. But insiders sold 20.00k shares worth US$38k. In total, ThredUp insiders bought more than they sold over the last year. The average buy price was around US$1.01. We don't deny that it is nice to see insiders buying stock in the company. However, we do note that they were buying at significantly lower prices than today's share price. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

See our latest analysis for ThredUp

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

ThredUp Insiders Bought Stock Recently

There was some insider buying at ThredUp over the last quarter. Independent Director Ian Friedman purchased US$15k worth of shares in that period. It's great to see that insiders are only buying, not selling. However, in this case the amount invested recently is quite small.

Does ThredUp Boast High Insider Ownership?

Many investors like to check how much of a company is owned by insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It appears that ThredUp insiders own 9.9% of the company, worth about US$49m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

What Might The Insider Transactions At ThredUp Tell Us?

We note a that there has been a bit of insider buying recently (but no selling). That said, the purchases were not large. But insiders have shown more of an appetite for the stock, over the last year. Overall we don't see anything to make us think ThredUp insiders are doubting the company, and they do own shares. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. You'd be interested to know, that we found 1 warning sign for ThredUp and we suggest you have a look.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity and low debt.

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.