Have Insiders Been Buying Flight Centre Travel Group Limited (ASX:FLT) Shares This Year?

It is not uncommon to see companies perform well in the years after insiders buy shares. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sell Flight Centre Travel Group Limited (ASX:FLT), 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, rules govern insider transactions, and certain disclosures are required.

We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year.

Check out our latest analysis for Flight Centre Travel Group

The Last 12 Months Of Insider Transactions At Flight Centre Travel Group

The Geoff Harris made the biggest insider purchase in the last 12 months. That single transaction was for AU$10.0m worth of shares at a price of AU$7.20 each. Even though the purchase was made at a significantly lower price than the recent price (AU$11.32), we still think insider buying is a positive. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

In the last twelve months Flight Centre Travel Group insiders were buying shares, but not selling. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.

Flight Centre Travel Group Insiders Bought Stock Recently

It's good to see that Flight Centre Travel Group insiders have made notable investments in the company's shares. Not only was there no selling that we can see, but they collectively bought AU$20m worth of shares. This is a positive in our book as it implies some confidence.

Does Flight Centre Travel Group Boast High Insider Ownership?

Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. It's great to see that Flight Centre Travel Group insiders own 16% of the company, worth about AU$371m. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

What Might The Insider Transactions At Flight Centre Travel Group Tell Us?

It is good to see recent purchasing. We also take confidence from the longer term picture of insider transactions. Once you factor in the high insider ownership, it certainly seems like insiders are positive about Flight Centre Travel Group. That's what I like to see! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Flight Centre Travel Group. Every company has risks, and we've spotted 2 warning signs for Flight Centre Travel Group (of which 1 doesn't sit too well with us!) you should know about.

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, but not derivative transactions.

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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. 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.
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