Insider Spends UK£91k Buying More Shares In Mears Group

Potential Mears Group plc (LON:MER) shareholders may wish to note that the CFO & Executive Director, Andrew C. Smith, recently bought UK£91k worth of stock, paying UK£3.64 for each share. While that's a very decent purchase to our minds, it was proportionally a bit modest, boosting their holding by just 6.5%.

Check out our latest analysis for Mears Group

Mears Group Insider Transactions Over The Last Year

The insider, David Miles, made the biggest insider sale in the last 12 months. That single transaction was for UK£540k worth of shares at a price of UK£3.61 each. That means that an insider was selling shares at slightly below the current price (UK£3.74). When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. We note that the biggest single sale was only 25% of David Miles's holding.

Over the last year, we can see that insiders have bought 73.48k shares worth UK£265k. On the other hand they divested 249.22k shares, for UK£900k. In total, Mears Group insiders sold more than they bought over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. 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 Mears Group

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. From looking at our data, insiders own UK£3.4m worth of Mears Group stock, about 1.0% of the company. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. I generally like to see higher levels of ownership.

So What Does This Data Suggest About Mears Group Insiders?

It's certainly positive to see the recent insider purchases. On the other hand the transaction history, over the last year, isn't so positive. Neither the level of insider ownership, nor the transactions over the last twelve months inspire us, but we think the recent buying is positive. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Be aware that Mears Group is showing 2 warning signs in our investment analysis, and 1 of those doesn't sit too well with us...

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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.