Selling Cel AI Shares at a Lower Price Than Current Market Value May Have Been a Costly Mistake for Insiders

Despite the fact that Cel AI PLC's (LON:CLAI) value has dropped 21% in the last week insiders who sold UK£417k worth of stock in the past 12 months have had less success. Insiders would probably have been better off holding on to their shares given that the average selling price of UK£0.0044 is still lower than the current share price.

While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.

View our latest analysis for Cel AI

The Last 12 Months Of Insider Transactions At Cel AI

Over the last year, we can see that the biggest insider sale was by the Non-Executive Director, Matthew Lodge, for UK£364k worth of shares, at about UK£0.0047 per share. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. The good news is that this large sale was at well above current price of UK£0.00063. So it is hard to draw any strong conclusion from it. Matthew Lodge was the only individual insider to sell over the last year.

Matthew Lodge divested 95.00m shares over the last 12 months at an average price of UK£0.0044. 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 Cel AI 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 Cel AI

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. From looking at our data, insiders own UK£17k worth of Cel AI stock, about 4.6% of the company. We prefer to see high levels of insider ownership.

What Might The Insider Transactions At Cel AI Tell Us?

There haven't been any insider transactions in the last three months -- that doesn't mean much. We don't take much encouragement from the transactions by Cel AI insiders. We also note that, as far as we can see, insider ownership is fairly low, compared to other companies. 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. When we did our research, we found 5 warning signs for Cel AI (4 are potentially serious!) that we believe deserve your full attention.

But note: Cel AI may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.

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.