COSOL Limited's (ASX:COS)) market cap declines to AU$85m but insiders who sold AU$787k stock were able to hedge their losses

Simply Wall St
May 10, 2022
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Insiders at COSOL Limited (ASX:COS) sold AU$787k worth of stock at an average price of AU$0.64 a share over the past year, making the most of their investment. The company’s market cap plunged by AU$11m after price dropped by 11% last week but insiders were able to limit their loss to an extent.

While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.

View our latest analysis for COSOL

COSOL Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the insider, Bradley Skeggs, for AU$787k worth of shares, at about AU$0.64 per share. That means that an insider was selling shares at around the current price of AU$0.60. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. In this case, the big sale took place at around the current price, so it's not too bad (but it's still not a positive). The only individual insider seller over the last year was Bradley Skeggs.

The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

ASX:COS Insider Trading Volume May 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 of COSOL

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. COSOL insiders own about AU$46m worth of shares (which is 54% 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 COSOL Insider Transactions Indicate?

The fact that there have been no COSOL insider transactions recently certainly doesn't bother us. It's heartening that insiders own plenty of stock, but we'd like to see more insider buying, since the last year of COSOL insider transactions don't fill us with confidence. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing COSOL. Case in point: We've spotted 3 warning signs for COSOL you should be aware of.

But note: COSOL 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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