Have Insiders Been Selling Sound Energy plc (LON:SOU) Shares?

We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So shareholders might well want to know whether insiders have been buying or selling shares in Sound Energy plc (LON:SOU).

What Is Insider Buying?

It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, rules govern insider transactions, and certain disclosures are required.

We don't think shareholders should simply follow insider transactions. But equally, we would consider it foolish to ignore insider transactions altogether. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.'

Check out our latest analysis for Sound Energy

The Last 12 Months Of Insider Transactions At Sound Energy

In the last twelve months, the biggest single sale by an insider was when CEO & Executive Director James Parsons sold UK£409k worth of shares at a price of UK£0.41 per share. That is hardly a positive sign, even though it took place above the latest price (UK£0.14). So it is hard to draw any strong conclusion from it. The only individual insider seller over the last year was James Parsons.

You can see a visual depiction of insider transactions over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

I will like Sound Energy better if I see some big insider buys. While we wait, check out this freelist of growing companies with considerable, recent, insider buying.

Does Sound Energy Boast High Insider Ownership?

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. Sound Energy insiders own 0.3% of the company, currently worth about UK£355k based on the recent share price. 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 Sound Energy Tell Us?

The fact that there have been no Sound Energy insider transactions recently certainly doesn't bother us. Our analysis of Sound Energy insider transactions leaves us unenthusiastic. And we're not picking up on high enough insider ownership to give us any comfort. Therefore, you should should definitely take a look at this FREEreport showing analyst forecasts for Sound Energy.

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

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.

Simply Wall St analyst Simply Wall St and Simply Wall St have no position in any of the companies mentioned. This article 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.