Have Insiders Been Buying Globex Data Ltd. (CSE:SWIS) Shares This Year?

We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So before you buy or sell Globex Data Ltd. (CSE:SWIS), you may well want to know whether insiders have been buying or selling.

Do Insider Transactions Matter?

It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, most countries require that the company discloses such transactions to the market.

We don't think shareholders should simply follow insider transactions. But it is perfectly logical to keep tabs on what insiders are doing. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise'.

Check out our latest analysis for Globex Data

Globex Data Insider Transactions Over The Last Year

In fact, the recent sale by Alain Ghiai-Chamlou was the biggest sale of Globex Data shares made by an insider individual in the last twelve months, according to our records. That means that even when the share price was below the current price of CA$0.17, an insider wanted to cash in some shares. 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. However, while insider selling is sometimes discouraging, it's only a weak signal. We note that the biggest single sale was only 13%of Alain Ghiai-Chamlou's holding.

Happily, we note that in the last year insiders paid CA$267k for 2.21m shares. But they sold 4.48m shares for CA$556k. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

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).

Insiders at Globex Data Have Sold Stock Recently

There was substantially more insider selling, than buying, of Globex Data shares over the last three months. In total, President Alain Ghiai-Chamlou sold CA$556k worth of shares in that time. On the other hand we note insiders bought CA$247k worth of shares. The share price has moved a bit recently, but it's hard to argue that the selling is a positive.

Does Globex Data 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. We usually like to see fairly high levels of insider ownership. Globex Data insiders own about CA$7.0m worth of shares (which is 57% of the company). 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 Do The Globex Data Insider Transactions Indicate?

Unfortunately, there has been more insider selling of Globex Data stock, than buying, in the last three months. Zooming out, the longer term picture doesn't give us much comfort. It is good to see high insider ownership, but the insider selling leaves us cautious. 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 that end, you should learn about the 5 warning signs we've spotted with Globex Data (including 3 which are a bit concerning).

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. 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.
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