How Many Redbubble Limited (ASX:RBL) Shares Have Insiders Sold, In The Last Year?

We often see insiders buying up shares in companies that perform well over the long term. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So we'll take a look at whether insiders have been buying or selling shares in Redbubble Limited (ASX:RBL).

Do Insider Transactions Matter?

It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, most countries require that the company discloses such transactions to the market.

Insider transactions are not the most important thing when it comes to long-term investing. But it is perfectly logical to keep tabs on what insiders are doing. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise'.

Check out our latest analysis for Redbubble

The Last 12 Months Of Insider Transactions At Redbubble

In the last twelve months, the biggest single sale by an insider was when the Co-Founder, Martin Hosking, sold AU$33m worth of shares at a price of AU$5.52 per share. That means that an insider was selling shares at slightly below the current price (AU$6.73). 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. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. It is worth noting that this sale was only 12% of Martin Hosking's holding.

Happily, we note that in the last year insiders paid AU$300k for 189.00k shares. But insiders sold 9.00m shares worth AU$39m. All up, insiders sold more shares in Redbubble than they bought, over the last year. The sellers received a price of around AU$4.32, on average. It's not particularly great to see insiders were selling shares at below recent prices. But we wouldn't put too much weight on the insider selling. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

Does Redbubble Boast High 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. We usually like to see fairly high levels of insider ownership. Redbubble insiders own about AU$370m worth of shares (which is 20% of the company). 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 Do The Redbubble Insider Transactions Indicate?

It doesn't really mean much that no insider has traded Redbubble shares in the last quarter. While we feel good about high insider ownership of Redbubble, we can't say the same about the selling of shares. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For example - Redbubble has 2 warning signs we think you should be aware of.

But note: Redbubble may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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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This article by Simply Wall St is general in nature. 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.
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