Don't Ignore The Insider Selling In GlobalData

We wouldn't blame GlobalData Plc (LON:DATA) shareholders if they were a little worried about the fact that Michael Danson, the CEO & Executive Director recently netted about UK£3.9m selling shares at an average price of UK£1.95. However, it's crucial to note that they remain very much invested in the stock and that sale only reduced their holding by 0.4%.

Check out our latest analysis for GlobalData

The Last 12 Months Of Insider Transactions At GlobalData

In fact, the recent sale by CEO & Executive Director Michael Danson was not their only sale of GlobalData shares this year. They previously made an even bigger sale of -UK£23m worth of shares at a price of UK£2.25 per share. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. The good news is that this large sale was at well above current price of UK£1.96. So it may not tell us anything about how insiders feel about the current share price.

In total, GlobalData insiders sold more than they bought over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

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Insider Ownership Of GlobalData

Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. GlobalData insiders own 60% of the company, currently worth about UK£938m based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Do The GlobalData Insider Transactions Indicate?

An insider sold stock recently, but they haven't been buying. And our longer term analysis of insider transactions didn't bring confidence, either. It is good to see high insider ownership, but the insider selling leaves us cautious. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. For example - GlobalData has 2 warning signs we think you should be aware of.

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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 of direct interests only, but not derivative transactions or indirect interests.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.