Don't Ignore The Insider Selling In Vulcan Steel

We wouldn't blame Vulcan Steel Limited (ASX:VSL) shareholders if they were a little worried about the fact that Rhys Jones, the CEO, MD & Executive Director recently netted about AU$2.0m selling shares at an average price of AU$8.07. However, that sale only accounted for 9.6% of their holding, so arguably it doesn't say much about their conviction.

Check out our latest analysis for Vulcan Steel

The Last 12 Months Of Insider Transactions At Vulcan Steel

In fact, the recent sale by Rhys Jones was the biggest sale of Vulcan Steel shares made by an insider individual in the last twelve months, according to our records. So we know that an insider sold shares at around the present share price of AU$7.58. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. Given that the sale took place at around current prices, it makes us a little cautious but is hardly a major concern.

Over the last year we saw more insider selling of Vulcan Steel shares, than buying. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, 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 Vulcan Steel

For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Vulcan Steel insiders own 39% of the company, currently worth about AU$386m based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Does This Data Suggest About Vulcan Steel Insiders?

Insiders sold stock recently, but they haven't been buying. Despite some insider buying, the longer term picture doesn't make us feel much more positive. 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. 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. Be aware that Vulcan Steel is showing 4 warning signs in our investment analysis, and 1 of those is concerning...

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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 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.