Have Insiders Been Buying SIG plc (LON:SHI) 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 shareholders might well want to know whether insiders have been buying or selling shares in SIG plc (LON:SHI).

What Is Insider Selling?

It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, such insiders must disclose their trading activities, and not trade on inside information.

Insider transactions are not the most important thing when it comes to long-term investing. But it is perfectly logical to keep tabs on what insiders are doing. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year'.

See our latest analysis for SIG

SIG Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the Director, Stephen Francis, sold UK£150k worth of shares at a price of UK£0.33 per share. That means that even when the share price was slightly below the current price of UK£0.34, 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. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. It is worth noting that this sale was only 48% of Stephen Francis's holding. Notably Stephen Francis was also the biggest buyer, having purchased UK£293k worth of shares.

Happily, we note that in the last year insiders paid UK£293k for 1.00m shares. But insiders sold 569.20k shares worth UK£190k. In the last twelve months there was more buying than selling by SIG insiders. They paid about UK£0.29 on average. These transactions show that insiders have confidence to invest their own money in the stock, albeit at slightly below the recent price. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).

Does SIG 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. I reckon it's a good sign if insiders own a significant number of shares in the company. Our information indicates that SIG insiders own about UK£552k worth of shares. But they may have an indirect interest through a corporate structure that we haven't picked up on. It's always possible we are missing something but from our data, it looks like insider ownership is minimal.

So What Does This Data Suggest About SIG Insiders?

The fact that there have been no SIG insider transactions recently certainly doesn't bother us. But insiders have shown more of an appetite for the stock, over the last year. The transactions are fine but it'd be more encouraging if SIG insiders bought more shares in the company. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. At Simply Wall St, we've found that SIG has 3 warning signs (1 shouldn't be ignored!) that deserve your attention before going any further with your analysis.

Of course SIG may not be the best stock to buy. So you may wish to see this free collection of high quality 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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