Insiders Buying Naked Wines Might Wish They Invested More, Stock Gains 14%

Naked Wines plc (LON:WINE) insiders who purchased shares in the last 12 months were richly rewarded last week. The stock climbed by 14% resulting in a UK£5.5m addition to the company’s market value. As a result, their original purchase of UK£317.6k worth of stock is now worth UK£420.2k.

While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.

Check out our latest analysis for Naked Wines

The Last 12 Months Of Insider Transactions At Naked Wines

Over the last year, we can see that the biggest insider purchase was by Independent Director Jack Pailing for UK£62k worth of shares, at about UK£0.43 per share. We do like to see buying, but this purchase was made at well below the current price of UK£0.59. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.

Naked Wines insiders may have bought shares in the last year, but they didn't sell any. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, 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. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).

Does Naked Wines Boast High Insider Ownership?

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. 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£1.7m worth of Naked Wines stock, about 3.8% of the company. We consider this fairly low insider ownership.

So What Do The Naked Wines Insider Transactions Indicate?

The fact that there have been no Naked Wines insider transactions recently certainly doesn't bother us. However, our analysis of transactions over the last year is heartening. We'd like to see bigger individual holdings. However, we don't see anything to make us think Naked Wines insiders are doubting 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. While conducting our analysis, we found that Naked Wines has 2 warning signs and it would be unwise to ignore these.

But note: Naked Wines 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 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.