Don't Ignore The Insider Selling In Topicus.com

We wouldn't blame Topicus.com Inc. (CVE:TOI) shareholders if they were a little worried about the fact that Daan Dijkhuizen, the Group Chief Executive Officer of Topicus Operating Group recently netted about CA$2.0m selling shares at an average price of CA$140. However, that sale only accounted for 6.5% of their holding, so arguably it doesn't say much about their conviction.

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Topicus.com Insider Transactions Over The Last Year

The insider, Robert Alfred Scotchmer, made the biggest insider sale in the last 12 months. That single transaction was for CA$5.4m worth of shares at a price of CA$134 each. So it's clear an insider wanted to take some cash off the table, even below the current price of CA$143. We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. 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. This single sale was just 30% of Robert Alfred Scotchmer's stake.

Over the last year we saw more insider selling of Topicus.com shares, than buying. 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!

See our latest analysis for Topicus.com

I will like Topicus.com better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Insider Ownership Of Topicus.com

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. Topicus.com insiders own 2.2% of the company, currently worth about CA$262m 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.

What Might The Insider Transactions At Topicus.com Tell Us?

Insiders sold Topicus.com shares recently, but they didn't buy any. And our longer term analysis of insider transactions didn't bring confidence, either. On the plus side, Topicus.com makes money, and is growing profits. It is good to see high insider ownership, but the insider selling leaves us cautious. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Topicus.com. While conducting our analysis, we found that Topicus.com has 1 warning sign and it would be unwise to ignore this.

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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.