Insiders of Zoono Group Limited (ASX:ZNO) would have made a tidy sum after selling NZ$4.9m worth of stock at a high price

By
Simply Wall St
Published
February 10, 2022
ASX:ZNO
Source: Shutterstock

Last week, Zoono Group Limited's (ASX:ZNO) stock jumped 11%, but insiders who sold NZ$4.9m worth of stock in over the past year are likely to be in a better position. Selling at an average price of NZ$0.70, which is higher than the current price, may have been the best move for these insiders because their investment would have been worth less now than when they sold.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

See our latest analysis for Zoono Group

The Last 12 Months Of Insider Transactions At Zoono Group

Over the last year, we can see that the biggest insider sale was by the CEO, MD & Director, Paul Hyslop, for AU$4.9m worth of shares, at about AU$0.70 per share. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. It's of some comfort that this sale was conducted at a price well above the current share price, which is AU$0.31. So it may not shed much light on insider confidence at current levels. Paul Hyslop was the only individual insider to sell over the last year.

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!

insider-trading-volume
ASX:ZNO Insider Trading Volume February 10th 2022

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: insiders have been buying them).

Insider Ownership

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. Zoono Group insiders own about AU$22m worth of shares (which is 43% of the company). I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Do The Zoono Group Insider Transactions Indicate?

There haven't been any insider transactions in the last three months -- that doesn't mean much. While we feel good about high insider ownership of Zoono Group, we can't say the same about the selling of shares. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Zoono Group. For instance, we've identified 5 warning signs for Zoono Group (1 is concerning) you should be aware of.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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, but not derivative transactions.

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