This Insider Has Just Sold Shares In Credit Intelligence Limited (ASX:CI1)

We wouldn't blame Credit Intelligence Limited (ASX:CI1) shareholders if they were a little worried about the fact that Biing Tan, a company insider, recently netted about AU$7.9m selling shares at an average price of AU$0.05. That sale reduced their total holding by 49% which is hardly insignificant, but far from the worst we've seen.

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The Last 12 Months Of Insider Transactions At Credit Intelligence

In fact, the recent sale by Biing Tan was the biggest sale of Credit Intelligence shares made by an insider individual in the last twelve months, according to our records. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. The silver lining is that this sell-down took place above the latest price (AU$0.039). So it may not tell us anything about how insiders feel about the current share price.

Happily, we note that in the last year insiders paid AU$341k for 13.90m shares. On the other hand they divested 229.03m shares, for AU$10m. All up, insiders sold more shares in Credit Intelligence than they bought, over the last year. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

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Insider Ownership

Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Credit Intelligence insiders own 50% of the company, currently worth about AU$30m based on the recent share price. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Do The Credit Intelligence Insider Transactions Indicate?

An insider hasn't bought Credit Intelligence stock in the last three months, but there was some selling. Zooming out, the longer term picture doesn't give us much comfort. But since Credit Intelligence is profitable and growing, we're not too worried by this. It is good to see high insider ownership, but the insider selling leaves us cautious. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. For instance, we've identified 5 warning signs for Credit Intelligence (1 is a bit concerning) you should be aware of.

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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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