Don't Ignore The Insider Selling In CAB Payments Holdings

We'd be surprised if CAB Payments Holdings Limited (LON:CABP) shareholders haven't noticed that the Chief Risk Officer & Head of Compliance, Christopher Green, recently sold UK£129k worth of stock at UK£1.55 per share. That sale was 11% of their holding, so it does make us raise an eyebrow.

View our latest analysis for CAB Payments Holdings

CAB Payments Holdings Insider Transactions Over The Last Year

In fact, the recent sale by Christopher Green was the biggest sale of CAB Payments Holdings shares made by an insider individual in the last twelve months, according to our records. That means that an insider was selling shares at below the current price (UK£1.55). We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. This single sale was just 11% of Christopher Green's stake.

Happily, we note that in the last year insiders paid UK£97k for 133.45k shares. But insiders sold 83.45k shares worth UK£129k. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

I will like CAB Payments Holdings better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Insider Ownership Of CAB Payments Holdings

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. CAB Payments Holdings insiders own about UK£14m worth of shares. That equates to 3.5% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Do The CAB Payments Holdings Insider Transactions Indicate?

An insider sold stock recently, but they haven't been buying. Despite some insider buying, the longer term picture doesn't make us feel much more positive. Insiders own shares, but we're still pretty cautious, given the history of sales. So we'd only buy after careful consideration. 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. Case in point: We've spotted 4 warning signs for CAB Payments Holdings you should be aware of.

Of course CAB Payments Holdings 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 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.