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 TBC Bank Group PLC (LON:TBCG), you may well want to know whether insiders have been buying or selling.
What Is Insider Selling?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock in the company. However, most countries require that the company discloses such transactions to the market.
Insider transactions are not the most important thing when it comes to long-term investing. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year'.
TBC Bank Group Insider Transactions Over The Last Year
In the last twelve months, the biggest single sale by an insider was when the insider, Giorgi Shagidze, sold UK£714k worth of shares at a price of UK£12.99 per share. That means that an insider was selling shares at around the current price of UK£11.20. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. In this case, the big sale took place at around the current price, so it's not too bad (but it's still not a positive).
TBC Bank Group insiders didn't buy any shares 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!
I will like TBC Bank Group better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
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. It's great to see that TBC Bank Group insiders own 16% of the company, worth about UK£100m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
So What Do The TBC Bank Group Insider Transactions Indicate?
It doesn't really mean much that no insider has traded TBC Bank Group shares in the last quarter. Our analysis of TBC Bank Group insider transactions leaves us cautious. But it's good to see that insiders own shares in the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing TBC Bank Group. For example - TBC Bank Group has 1 warning sign we think you should be aware of.
But note: TBC Bank Group may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.
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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