Johnson Matthey Insiders Added UK£438k Of Stock To Their Holdings

Generally, when a single insider buys stock, it is usually not a big deal. However, when several insiders are buying, like in the case of Johnson Matthey Plc (LON:JMAT), it sends a favourable message to the company's shareholders.

While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

Check out our latest analysis for Johnson Matthey

The Last 12 Months Of Insider Transactions At Johnson Matthey

Notably, that recent purchase by Chief Executive Officer Liam Condon was not the only time they bought Johnson Matthey shares this year. Earlier in the year, they paid UK£19.95 per share in a UK£219k purchase. That means that an insider was happy to buy shares at above the current price of UK£17.25. Their view may have changed since then, but at least it shows they felt optimistic at the time. To us, it's very important to consider the price insiders pay for shares. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.

Johnson Matthey insiders may have bought shares in the last year, but they didn't sell any. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.

Insiders At Johnson Matthey Have Bought Stock Recently

Over the last quarter, Johnson Matthey insiders have spent a meaningful amount on shares. Not only was there no selling that we can see, but they collectively bought UK£216k worth of shares. That shows some optimism about the company's future.

Insider Ownership

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. From looking at our data, insiders own UK£2.0m worth of Johnson Matthey stock, about 0.07% of the company. We prefer to see high levels of insider ownership.

What Might The Insider Transactions At Johnson Matthey Tell Us?

The recent insider purchases are heartening. And the longer term insider transactions also give us confidence. While the overall levels of insider ownership are below what we'd like to see, the history of transactions imply that Johnson Matthey insiders are reasonably well aligned, and optimistic for the future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Johnson Matthey. Every company has risks, and we've spotted 1 warning sign for Johnson Matthey you should know about.

But note: Johnson Matthey 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, but not derivative transactions.

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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.