Insiders At Kits Eyecare Sold CA$14m Of Stock Potentially Indicating Weakness

Last week, Kits Eyecare Ltd.'s (TSE:KITS) stock jumped 12%, but insiders who sold CA$14m worth of stock in over the past year are likely to be in a better position. Selling at an average price of CA$10.15, 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.

Check out our latest analysis for Kits Eyecare

The Last 12 Months Of Insider Transactions At Kits Eyecare

The Co-Founder, Roger Hardy, made the biggest insider sale in the last 12 months. That single transaction was for CA$8.4m worth of shares at a price of CA$10.15 each. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. The good news is that this large sale was at well above current price of CA$8.50. So it is hard to draw any strong conclusion from it.

Happily, we note that in the last year insiders paid CA$69k for 9.79k shares. But they sold 1.35m shares for CA$14m. All up, insiders sold more shares in Kits Eyecare than they bought, over the last year. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

For those who like to find hidden gems this free list of small cap companies with recent insider purchasing, could be just the ticket.

Insider Ownership Of Kits Eyecare

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. We usually like to see fairly high levels of insider ownership. Kits Eyecare insiders own about CA$65m worth of shares. That equates to 25% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Does This Data Suggest About Kits Eyecare Insiders?

The fact that there have been no Kits Eyecare insider transactions recently certainly doesn't bother us. Still, the insider transactions at Kits Eyecare in the last 12 months are not very heartening. But it's good to see that insiders own shares in the company. If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

Of course Kits Eyecare 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.