This Insider Has Just Sold Shares In PSC Insurance Group Limited (ASX:PSI)

We wouldn't blame PSC Insurance Group Limited (ASX:PSI) shareholders if they were a little worried about the fact that Paul Dwyer, the Deputy Chairman recently netted about AU$30m selling shares at an average price of AU$3.00. That sale reduced their total holding by 15% which is hardly insignificant, but far from the worst we've seen.

View our latest analysis for PSC Insurance Group

PSC Insurance Group Insider Transactions Over The Last Year

Notably, that recent sale by Paul Dwyer is the biggest insider sale of PSC Insurance Group shares that we've seen in the last year. That means that an insider was selling shares at slightly below the current price (AU$3.08). 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 15%of Paul Dwyer's holding.

Over the last year, we can see that insiders have bought 1.41m shares worth AU$3.6m. But they sold 13.33m shares for AU$40m. In total, PSC Insurance Group insiders sold more than they bought over the last year. The sellers received a price of around AU$3.00, on average. It's not particularly great to see insiders were selling shares at below recent prices. Since insiders sell for many reasons, we wouldn't put too much weight on it. 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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Insider Ownership of PSC Insurance Group

Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. It's great to see that PSC Insurance Group insiders own 56% of the company, worth about AU$505m. 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 PSC Insurance Group Insiders?

Insiders sold stock recently, but they haven't been buying. And our longer term analysis of insider transactions didn't bring confidence, either. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Be aware that PSC Insurance Group is showing 6 warning signs in our investment analysis, and 1 of those is potentially serious...

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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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