We’ve lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. On the other hand, we’d be remiss not to mention that insider sales have been known to precede tough periods for a business. So before you buy or sell Hitech & Development Wireless Sweden Holding AB (publ) (STO:HDW B), you may well want to know whether insiders have been buying or selling.
What Is Insider Buying?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock in the company. However, most countries require that the company discloses such transactions to the market.
We don’t think shareholders should simply follow insider transactions. But it is perfectly logical to keep tabs on what insiders are doing. For example, a Harvard University study found that ‘insider purchases earn abnormal returns of more than 6% per year.
The Last 12 Months Of Insider Transactions At Hitech & Development Wireless Sweden Holding
Over the last year, we can see that the biggest insider sale was by the Founder, Pär Bergsten, for kr3.0m worth of shares, at about kr1.50 per share. While we don’t usually like to see insider selling, it’s more concerning if the sales take place at a lower price. It’s of some comfort that this sale was conducted at a price well above the current share price, which is kr0.33. So it may not tell us anything about how insiders feel about the current share price. Pär Bergsten was the only individual insider to sell over the last year.
You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Insider Ownership of Hitech & Development Wireless Sweden Holding
For a common shareholder, it is worth checking how many shares are held by company 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. Insiders own 9.4% of Hitech & Development Wireless Sweden Holding shares, worth about kr1.9m, according to our data. Whilst better than nothing, we’re not overly impressed by these holdings.
What Might The Insider Transactions At Hitech & Development Wireless Sweden Holding Tell Us?
It doesn’t really mean much that no insider has traded Hitech & Development Wireless Sweden Holding shares in the last quarter. Our analysis of Hitech & Development Wireless Sweden Holding insider transactions leaves us unenthusiastic. We also note that, as far as we can see, insider ownership is fairly low, compared to other companies. So these insider transactions can help us build a thesis about the stock, but it’s also worthwhile knowing the risks facing this company. Be aware that Hitech & Development Wireless Sweden Holding is showing 6 warning signs in our investment analysis, and 3 of those are concerning…
But note: Hitech & Development Wireless Sweden Holding may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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, but not derivative transactions.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
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