Have Generation Development Group Insiders Been Selling Stock?

We wouldn't blame Generation Development Group Limited (ASX:GDG) shareholders if they were a little worried about the fact that William Bessemer, the Non-Executive Director recently netted about AU$4.0m selling shares at an average price of AU$2.66. That's a big disposal, and it decreased their holding size by 11%, which is notable but not too bad.

See our latest analysis for Generation Development Group

The Last 12 Months Of Insider Transactions At Generation Development Group

In the last twelve months, the biggest single sale by an insider was when the insider, John Wheeler, sold AU$5.0m worth of shares at a price of AU$2.41 per share. That means that even when the share price was below the current price of AU$2.77, an insider wanted to cash in some shares. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. This single sale was just 23% of John Wheeler's stake. Notably John Wheeler was also the biggest buyer, having purchased AU$1.6m worth of shares.

Over the last year, we can see that insiders have bought 872.88k shares worth AU$1.6m. But they sold 5.78m shares for AU$9.9m. Over the last year we saw more insider selling of Generation Development Group shares, than buying. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

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Does Generation Development Group 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. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It's great to see that Generation Development Group insiders own 23% of the company, worth about AU$191m. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

What Might The Insider Transactions At Generation Development Group Tell Us?

The stark truth for Generation Development Group is that there has been more insider selling than insider buying in the last three months. And our longer term analysis of insider transactions didn't bring confidence, either. On the plus side, Generation Development Group makes money, and is growing profits. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Generation Development Group. To help with this, we've discovered 2 warning signs (1 is a bit unpleasant!) that you ought to be aware of before buying any shares in Generation Development Group.

Of course Generation Development Group 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 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.