We often see insiders buying up shares in companies that perform well over the long term. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sell Tritax Big Box REIT plc (LON:BBOX), you may well want to know whether insiders have been buying or selling.
What Is Insider Buying?
It’s quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, rules govern insider transactions, and certain disclosures are required.
Insider transactions are not the most important thing when it comes to long-term investing. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Columbia University study found that ‘insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers’.
Check out our latest analysis for Tritax Big Box REIT
The Last 12 Months Of Insider Transactions At Tritax Big Box REIT
In the last twelve months, the biggest single purchase by an insider was when insider Mark Glenn Shaw bought UK£273k worth of shares at a price of UK£0.88 per share. Even though the purchase was made at a significantly lower price than the recent price (UK£1.51), we still think insider buying is a positive. Because the shares were purchased at a lower price, this particular buy doesn’t tell us much about how insiders feel about the current share price.
In the last twelve months Tritax Big Box REIT insiders were buying shares, but not selling. They paid about UK£1.03 on average. It is certainly positive to see that insiders have invested their own money in the company. But we must note that the investments were made at well below today’s share price. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Tritax Big Box REIT is not the only stock that insiders are buying. 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
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. We usually like to see fairly high levels of insider ownership. It appears that Tritax Big Box REIT insiders own 0.5% of the company, worth about UK£12m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
So What Do The Tritax Big Box REIT Insider Transactions Indicate?
The fact that there have been no Tritax Big Box REIT insider transactions recently certainly doesn’t bother us. But insiders have shown more of an appetite for the stock, over the last year. Insiders own shares in Tritax Big Box REIT and we see no evidence to suggest they are worried about the future. While we like knowing what’s going on with the insider’s ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. For instance, we’ve identified 5 warning signs for Tritax Big Box REIT (1 doesn’t sit too well with us) you should be aware of.
Of course Tritax Big Box REIT may not be the best stock to buy. So you may wish to see this free collection of high quality companies.
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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