Don't Ignore The Fact That This Insider Just Sold Some Shares In Lloyds Banking Group plc (LON:LLOY)

Some Lloyds Banking Group plc (LON:LLOY) shareholders may be a little concerned to see that insider Vimlesh Maru recently sold a substantial UK£416k worth of stock at a price of UK£0.42 per share. That sale reduced their total holding by 15% which is hardly insignificant, but far from the worst we've seen.

View our latest analysis for Lloyds Banking Group

The Last 12 Months Of Insider Transactions At Lloyds Banking Group

In fact, the recent sale by Vimlesh Maru was the biggest sale of Lloyds Banking Group shares made by an insider individual in the last twelve months, according to our records. So it's clear an insider wanted to take some cash off the table, even slightly below the current price of UK£0.42. 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. This single sale was just 15% of Vimlesh Maru's stake.

Over the last year, we can see that insiders have bought 2.00m shares worth UK£531k. But they sold 2.09m shares for UK£824k. In total, Lloyds Banking Group insiders sold more 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. By clicking on the graph below, you can see the precise details of each insider transaction!

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Insider Ownership

Many investors like to check how much of a company is owned by 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. Lloyds Banking Group insiders own about UK£61m worth of shares. That equates to 0.2% 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 Do The Lloyds Banking Group Insider Transactions Indicate?

Insiders haven't bought Lloyds Banking Group stock in the last three months, but there was some selling. And our longer term analysis of insider transactions didn't bring confidence, either. While insiders do own shares, they don't own a heap, and they have been selling. We're in no rush to buy! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For instance, we've identified 3 warning signs for Lloyds Banking Group (1 makes us a bit uncomfortable) you should be aware of.

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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