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We often see insiders buying up shares in companies that perform well over the long term. On the other hand, we’d be remiss not to mention that insider sales have been known to precede tough periods for a business. So before you buy or sell Galliford Try plc (LON:GFRD), you may well want to know whether insiders have been buying or selling.
Do Insider Transactions Matter?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, rules govern insider transactions, and certain disclosures are required.
We don’t think shareholders should simply follow insider transactions. 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.’
View our latest analysis for Galliford Try
The Last 12 Months Of Insider Transactions At Galliford Try
CEO of Partnerships & Regeneration and Member of Executive Board Stephen Teagle made the biggest insider purchase in the last 12 months. That single transaction was for UK£57k worth of shares at a price of UK£6.33 each. That implies that an insider found the current (approximate) price enticing. Of course they may have changed their mind. But this suggests they are optimistic. We generally consider it a positive if insiders have been buying on market, even if the share price has increased a bit since then.
Over the last year, we can see that insiders have bought 19.68k shares worth UK£127k. In the last twelve months there was more buying than selling by Galliford Try insiders. They paid about UK£6.44 on average. It’s great to see insiders putting their own cash into the company’s stock, albeit at below the recent share price (UK£7.20). You can see a visual depiction of insider transactions (by 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!
If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).
Insiders at Galliford Try Have Bought Stock Recently
Over the last three months, we’ve seen significant insider buying at Galliford Try. Not only was there no selling that we can see, but they collectively bought UK£109k worth of shares. This is a positive in our book as it implies some confidence.
Does Galliford Try Boast High Insider Ownership?
For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it’s a good sign if insiders own a significant number of shares in the company. From looking at our data, insiders own UK£2.6m worth of Galliford Try stock, about 0.3% of the company. We prefer to see high levels of insider ownership.
What Might The Insider Transactions At Galliford Try Tell Us?
The recent insider purchases are heartening. We also take confidence from the longer term picture of insider transactions. We would certainly prefer see higher levels of insider ownership but analysis of the insider transactions suggests that Galliford Try insiders are expecting a bright future. Of course, the future is what matters most. So if you are interested in Galliford Try, you should check out this free report on analyst forecasts for the company.
If you would prefer to check out another company — one with potentially superior financials — then do not miss this free list of interesting companies, that have HIGH return on equity and low debt.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.