Sareum Holdings Insiders Miss 64% Gain After Offloading Stock

While it’s been a great week for Sareum Holdings plc ( LON:SAR ) shareholders after stock gained 64%, company insiders might have missed out on those gains after selling stock earlier this year. The return on their investment would have been much higher had they held on to their stock.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

View our latest analysis for Sareum Holdings

Sareum Holdings Insider Transactions Over The Last Year

The Founder, Timothy Mitchell, made the biggest insider sale in the last 12 months. That single transaction was for UK£41k worth of shares at a price of UK£0.57 each. We would like to note that the sale was made to fund the exercise of stock options.

While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. It's of some comfort that this sale was conducted at a price well above the current share price, which is UK£0.24. So it is hard to draw any strong conclusion from it.

Happily, we note that in the last year insiders paid UK£14k for 17.13k shares. But they sold 122.43k shares for UK£70k. In total, Sareum Holdings insiders sold more than they bought over the last year.

Readers should note that insiders received  576,698 shares in lieu of salary deferrals and additionally, purchased 195,000 shares off-market.

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!

I will like Sareum Holdings better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

Does Sareum Holdings 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. From looking at our data, insiders own UK£542k worth of Sareum Holdings stock, about 2.2% of the company. I generally like to see higher levels of ownership.

So What Do The Sareum Holdings Insider Transactions Indicate?

It doesn't really mean much that no insider has traded Sareum Holdings shares in the last quarter. We don't take much encouragement from the transactions by Sareum Holdings insiders. We also note that, as far as we can see, insider ownership is fairly low, compared to other companies. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Case in point: We've spotted 4 warning signs for Sareum Holdings you should be aware of, and 3 of these don't sit too well with us.

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