Manolete Partners Plc's (LON:MANO) stock price has dropped 16% in the previous week, but insiders who sold UK£1.8m in stock over the past year have had less luck. Given that the average selling price of UK£1.80 is still lower than the current share price, insiders would probably have been better off keeping their shares.
Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.
The Last 12 Months Of Insider Transactions At Manolete Partners
The CEO & Executive Director, Steven Cooklin, made the biggest insider sale in the last 12 months. That single transaction was for UK£1.4m worth of shares at a price of UK£1.80 each. That means that an insider was selling shares at slightly below the current price (UK£2.53). 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. However, while insider selling is sometimes discouraging, it's only a weak signal. This single sale was just 9.6% of Steven Cooklin's stake. The only individual insider seller over the last year was Steven Cooklin.
Happily, we note that in the last year insiders paid UK£30k for 15.00k shares. But insiders sold 1.00m shares worth UK£1.8m. Steven Cooklin divested 1.00m shares over the last 12 months at an average price of UK£1.80. 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!
For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
For a common shareholder, it is worth checking how many shares are held by company insiders. 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's great to see that Manolete Partners insiders own 56% of the company, worth about UK£61m. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
What Might The Insider Transactions At Manolete Partners Tell Us?
The fact that there have been no Manolete Partners insider transactions recently certainly doesn't bother us. It's heartening that insiders own plenty of stock, but we'd like to see more insider buying, since the last year of Manolete Partners insider transactions don't fill us with confidence. 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. To help with this, we've discovered 3 warning signs (1 is concerning!) that you ought to be aware of before buying any shares in Manolete Partners.
Of course Manolete Partners may not be the best stock to buy. So you may wish to see this free collection of high quality 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, but not derivative transactions.
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.
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