Insiders At OSB Group Sold UK£2.5m In Stock, Alluding To Potential Weakness

The fact that multiple OSB Group Plc (LON:OSB) insiders offloaded a considerable amount of shares over the past year could have raised some eyebrows amongst investors. When analyzing insider transactions, it is usually more valuable to know whether insiders are buying versus knowing if they are selling, as the latter sends an ambiguous message. However, when multiple insiders sell stock over a specific duration, shareholders should take notice as that could possibly be a red flag.

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.

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OSB Group Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the Group CEO & Director, Andrew Golding, sold UK£1.2m worth of shares at a price of UK£4.84 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of UK£5.54. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. 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. We note that the biggest single sale was only 28% of Andrew Golding's holding.

All up, insiders sold more shares in OSB Group than they bought, over the last year. 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!

See our latest analysis for OSB Group

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: Most of them are flying under the radar).

OSB Group Insiders Are Selling The Stock

There was substantially more insider selling, than buying, of OSB Group shares over the last three months. In that time, insider Jens Bech dumped UK£206k worth of shares. On the other hand we note Group General Counsel & Company Secretary Jason Elphick bought UK£10k worth of shares. Since the selling really does outweigh the buying, we'd say that these transactions may suggest that some insiders feel the shares are not cheap.

Does OSB Group Boast High Insider Ownership?

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. It appears that OSB Group insiders own 0.4% of the company, worth about UK£8.1m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

What Might The Insider Transactions At OSB Group Tell Us?

Unfortunately, there has been more insider selling of OSB Group stock, than buying, in the last three months. Zooming out, the longer term picture doesn't give us much comfort. But since OSB Group is profitable and growing, we're not too worried by this. Insiders own relatively few shares in the company, and when you consider the sales, we're not particularly excited about the stock. We'd certainly practice some caution before buying! 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 OSB Group has 2 warning signs and it would be unwise to ignore these.

Of course OSB Group 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.