Are Insiders Buying The City Pub Group plc (LON:CPC) Stock?

We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. On the other hand, we'd be remiss not to mention that insider sales have been known to precede tough periods for a business. So shareholders might well want to know whether insiders have been buying or selling shares in The City Pub Group plc (LON:CPC).

Do Insider Transactions Matter?

It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, such insiders must disclose their trading activities, and not trade on inside information.

We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. 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'.

View our latest analysis for City Pub Group

The Last 12 Months Of Insider Transactions At City Pub Group

The Executive Chairman Clive Watson made the biggest insider purchase in the last 12 months. That single transaction was for UK£274k worth of shares at a price of UK£0.50 each. We do like to see buying, but this purchase was made at well below the current price of UK£0.82. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

Over the last year, we can see that insiders have bought 782.72k shares worth UK£448k. But insiders sold 30.00k shares worth UK£57k. In the last twelve months there was more buying than selling by City Pub Group insiders. Their average price was about UK£0.57. To my mind it is good that insiders have invested their own money in the company. However, we do note that they were buying at significantly lower prices than today's share 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!

City Pub Group is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Insiders at City Pub Group Have Bought Stock Recently

We saw some City Pub Group insider buying shares in the last three months. Executive Chairman Clive Watson purchased UK£18k worth of shares in that period. It's great to see that insiders are only buying, not selling. However, in this case the amount invested recently is quite small.

Insider Ownership of City Pub 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. I reckon it's a good sign if insiders own a significant number of shares in the company. From our data, it seems that City Pub Group insiders own 4.9% of the company, worth about UK£4.2m. Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!

So What Does This Data Suggest About City Pub Group Insiders?

Insider purchases may have been minimal, in the last three months, but there was no selling at all. Overall the buying isn't worth writing home about. But insiders have shown more of an appetite for the stock, over the last year. While we have no worries about the insider transactions, we'd be more comfortable if they owned more City Pub Group stock. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing City Pub Group. For instance, we've identified 2 warning signs for City Pub Group (1 is a bit unpleasant) you should be aware of.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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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