We often see insiders buying up shares in companies that perform well over the long term. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So we'll take a look at whether insiders have been buying or selling shares in Howden Joinery Group Plc (LON:HWDN).
Do Insider Transactions Matter?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, most countries require that the company discloses such transactions to the market.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But logic dictates you should pay some attention to whether insiders are buying or selling shares. 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'.
Howden Joinery Group Insider Transactions Over The Last Year
In the last twelve months, the biggest single sale by an insider was when the Chief Operating Officer of Howden Joinery Trade Division, Andy Witts, sold UK£2.0m worth of shares at a price of UK£5.83 per share. That means that an insider was selling shares at around the current price of UK£5.00. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. Given that the sale took place at around current prices, it makes us a little cautious but is hardly a major concern.
Happily, we note that in the last year insiders paid UK£441k for 87.97k shares. On the other hand they divested 545.55k shares, for UK£3.2m. All up, insiders sold more shares in Howden Joinery Group 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. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.
Does Howden Joinery Group Boast High Insider Ownership?
Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Our data indicates that Howden Joinery Group insiders own about UK£6.2m worth of shares (which is 0.2% of the company). Whilst better than nothing, we're not overly impressed by these holdings.
So What Do The Howden Joinery Group Insider Transactions Indicate?
There haven't been any insider transactions in the last three months -- that doesn't mean much. Our analysis of Howden Joinery Group insider transactions leaves us unenthusiastic. And we're not picking up on high enough insider ownership to give us any comfort. Therefore, you should definitely take a look at this FREE report showing analyst forecasts for Howden Joinery Group.
But note: Howden Joinery 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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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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