Insider Sellers Might Regret Selling MA Financial Group Shares at a Lower Price Than Current Market Value

MA Financial Group Limited's (ASX:MAF) stock price has dropped 12% in the previous week, but insiders who sold AU$1.7m in stock over the past year have had less luck. Given that the average selling price of AU$4.79 is still lower than the current share price, insiders would probably have been better off keeping their shares.

While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.

View our latest analysis for MA Financial Group

MA Financial Group Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the Co-Founder & Group Executive Vice Chairman, Andrew Pridham, sold AU$903k worth of shares at a price of AU$4.85 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 AU$4.00. So it may not tell us anything about how insiders feel about the current share price.

In total, MA Financial Group insiders sold more than they bought over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

I will like MA Financial Group better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. It's great to see that MA Financial Group insiders own 31% of the company, worth about AU$202m. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Does This Data Suggest About MA Financial Group Insiders?

It doesn't really mean much that no insider has traded MA Financial Group shares in the last quarter. It's heartening that insiders own plenty of stock, but we'd like to see more insider buying, since the last year of MA Financial Group insider transactions don't fill us with confidence. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For instance, we've identified 3 warning signs for MA Financial Group (2 don't sit too well with us) you should be aware of.

But note: MA Financial Group 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 of direct interests only, but not derivative transactions or indirect interests.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com