Trade Alert: The Independent Non-Executive Director Of Frontier Developments plc (LON:FDEV), Charles William Cotton, Has Just Spent UK£446k Buying 11% More Shares

Frontier Developments plc (LON:FDEV) shareholders (or potential shareholders) will be happy to see that the Independent Non-Executive Director, Charles William Cotton, recently bought a whopping UK£446k worth of stock, at a price of UK£25.97. Not only is that a big swing, but it increased their holding size by 11%, which is definitely great to see.

See our latest analysis for Frontier Developments

The Last 12 Months Of Insider Transactions At Frontier Developments

The Independent Non-Executive Chairman, David Gammon, made the biggest insider sale in the last 12 months. That single transaction was for UK£1.1m worth of shares at a price of UK£23.86 each. That means that an insider was selling shares at slightly below the current price (UK£25.85). As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower 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. It is worth noting that this sale was only 14% of David Gammon's holding.

All up, insiders sold more shares in Frontier Developments than they bought, over the last year. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

Insider Ownership of Frontier Developments

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. A high insider ownership often makes company leadership more mindful of shareholder interests. Frontier Developments insiders own about UK£349m worth of shares (which is 35% of the company). I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

What Might The Insider Transactions At Frontier Developments Tell Us?

The recent insider purchase is heartening. On the other hand the transaction history, over the last year, isn't so positive. The high levels of insider ownership, and the recent buying by an insider suggests they are well aligned and optimistic. 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. You'd be interested to know, that we found 1 warning sign for Frontier Developments and we suggest you have a look.

But note: Frontier Developments 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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