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 Ascent Resources plc (LON:AST), you may well want to know whether insiders have been buying or selling.
Do Insider Transactions Matter?
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, such insiders must disclose their trading activities, and not trade on inside information.
We don’t think shareholders should simply follow insider transactions. But equally, we would consider it foolish to ignore insider transactions altogether. As Peter Lynch said, ‘insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.’
The Last 12 Months Of Insider Transactions At Ascent Resources
In the last twelve months, the biggest single sale by an insider was when the insider, Asif Karim, sold UK£76k worth of shares at a price of UK£0.0076 per share. We generally don’t like to see insider selling, but the lower the sale price, the more it concerns us. It’s of some comfort that this sale was conducted at a price well above the current share price, which is UK£0.0022. So it may not shed much light on insider confidence at current levels. The only individual insider seller over the last year was Asif Karim. Notably Asif Karim was also the biggest buyer, having purchased UK£130k worth of shares.
Asif Karim bought a total of 20.2m shares over the year at an average price of UK£0.0065. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
Does Ascent Resources Boast High Insider Ownership?
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. Based on our data, Ascent Resources insiders have about 1.7% of the stock, worth approximately UK£90k. But they may have an indirect interest through a corporate structure that we haven’t picked up on. We prefer to see high levels of insider ownership.
So What Does This Data Suggest About Ascent Resources Insiders?
The fact that there have been no Ascent Resources insider transactions recently certainly doesn’t bother us. However, our analysis of transactions over the last year is heartening. We’d like to see bigger individual holdings. However, we don’t see anything to make us think Ascent Resources insiders are doubting the company. Of course, the future is what matters most. So if you are interested in Ascent Resources, you should check out this free report on analyst forecasts for the company.
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.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
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. Thank you for reading.