Insiders may have sold Technology One Limited (ASX:TNE) early at AU$14.04 per share, while current price continues to trade high at AU$14.27

Technology One Limited's (ASX:TNE) stock price has dropped 4.4% in the previous week, but insiders who sold AU$477k in stock over the past year have had less luck. Insiders would probably have been better off holding on to their shares given that the average selling price of AU$14.04 is still lower than the current share price.

While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.

View our latest analysis for Technology One

Technology One Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the insider, Ronald McLean, for AU$281k worth of shares, at about AU$14.06 per share. That means that an insider was selling shares at below the current price (AU$14.27). 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. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. We note that the biggest single sale was only 29% of Ronald McLean's holding.

All up, insiders sold more shares in Technology One than they bought, over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

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

Does Technology One Boast High Insider Ownership?

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Technology One insiders own 13% of the company, currently worth about AU$605m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Does This Data Suggest About Technology One Insiders?

There haven't been any insider transactions in the last three months -- that doesn't mean much. It's heartening that insiders own plenty of stock, but we'd like to see more insider buying, since the last year of Technology One insider transactions don't fill us with confidence. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. You'd be interested to know, that we found 1 warning sign for Technology One and we suggest you have a look.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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, but not derivative transactions.

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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.