Stock Analysis

Selling AU$28m Of Macquarie Technology Group Stock Rewarded Insiders

ASX:MAQ
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Even though Macquarie Technology Group Limited (ASX:MAQ) stock gained 11% last week, insiders who sold AU$28m worth of stock over the past year are probably better off. Holding on to stock would have meant their investment would be worth less now than it was at the time of sale. Thus selling at an average price of AU$80.00, which is higher than the current price, may have been the best decision.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

View our latest analysis for Macquarie Technology Group

The Last 12 Months Of Insider Transactions At Macquarie Technology Group

In the last twelve months, the biggest single sale by an insider was when the Co-Founder, David Tudehope, sold AU$28m worth of shares at a price of AU$80.00 per share. That means that even when the share price was below the current price of AU$91.38, an insider wanted to cash in some shares. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. It is worth noting that this sale was only 3.2% of David Tudehope's holding. David Tudehope 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 want to know exactly who sold, for how much, and when, simply click on the graph below!

insider-trading-volume
ASX:MAQ Insider Trading Volume May 10th 2024

I will like Macquarie Technology Group better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

Insiders At Macquarie Technology Group Have Sold Stock Recently

The last three months saw significant insider selling at Macquarie Technology Group. In total, Co-Founder David Tudehope sold AU$28m worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.

Insider Ownership Of Macquarie Technology Group

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. Macquarie Technology Group insiders own 46% of the company, currently worth about AU$1.1b 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 Do The Macquarie Technology Group Insider Transactions Indicate?

An insider hasn't bought Macquarie Technology Group stock in the last three months, but there was some selling. Looking to the last twelve months, our data doesn't show any insider buying. But it is good to see that Macquarie Technology Group is growing earnings. 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. To assist with this, we've discovered 1 warning sign that you should run your eye over to get a better picture of Macquarie Technology Group.

Of course Macquarie Technology Group may not be the best stock to buy. So you may wish to see this free collection of high quality companies.

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.