On the Beach Group Reaches UK£280m Market Cap Benefiting Insider Stock Buying

Last week, On the Beach Group plc (LON:OTB) insiders, who had purchased shares in the previous 12 months were rewarded handsomely. The shares increased by 15% last week, resulting in a UK£37m increase in the company's market worth, implying a 15% gain on their initial purchase. In other words, the original UK£174.5k purchase is now worth UK£200.1k.

While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.

View our latest analysis for On the Beach Group

The Last 12 Months Of Insider Transactions At On the Beach Group

Over the last year, we can see that the biggest insider sale was by the Independent Non-Executive Chairman of the Board, Richard Pennycook, for UK£60k worth of shares, at about UK£1.56 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of UK£1.68. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. This single sale was just 44% of Richard Pennycook's stake. Richard Pennycook was the only individual insider to sell shares in the last twelve months. Notably Richard Pennycook was also the biggest buyer, having purchased UK£174k worth of shares.

In the last twelve months insiders purchased 119.39k shares for UK£174k. But they sold 38.33k shares for UK£60k. Overall, On the Beach Group insiders were net buyers during the last year. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

On the Beach Group is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Are On the Beach Group Insiders Buying Or Selling?

In the last three months, insiders sold UK£60k. But that was only a smidgen more than the UK£59k worth of buying. Ultimately the overall selling isn't enough to tell us much.

Does On the Beach Group 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. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It appears that On the Beach Group insiders own 7.8% of the company, worth about UK£22m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

What Might The Insider Transactions At On the Beach Group Tell Us?

Insider buying and selling have balanced each other out in the last three months, so we can't deduct anything useful from these recent trades. On a brighter note, the transactions over the last year are encouraging. Overall we don't see anything to make us think On the Beach Group insiders are doubting the company, and they do own shares. While we like knowing 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. While conducting our analysis, we found that On the Beach Group has 3 warning signs and it would be unwise to ignore them.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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 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.