Have Ridley Corporation Limited (ASX:RIC) Insiders Been Selling Their Stock?

Some Ridley Corporation Limited (ASX:RIC) shareholders may be a little concerned to see that insider John Andrew Forrest recently sold a substantial AU$22m worth of stock at a price of AU$2.14 per share. That sale reduced their total holding by 48% which is hardly insignificant, but far from the worst we've seen.

Check out our latest analysis for Ridley

Ridley Insider Transactions Over The Last Year

Notably, that recent sale by John Andrew Forrest is the biggest insider sale of Ridley shares that we've seen in the last year. So it's clear an insider wanted to take some cash off the table, even slightly below the current price of AU$2.18. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. We note that the biggest single sale was only 48%of John Andrew Forrest's holding.

You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

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Does Ridley 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. I reckon it's a good sign if insiders own a significant number of shares in the company. It appears that Ridley insiders own 10.0% of the company, worth about AU$69m. 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 Does This Data Suggest About Ridley Insiders?

An insider sold Ridley shares recently, but they didn't buy any. And even if we look at the last year, we didn't see any purchases. On the plus side, Ridley makes money, and is growing profits. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. So we'd only buy after careful consideration. 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. At Simply Wall St, we found 2 warning signs for Ridley that deserve your attention before buying any shares.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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. 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.