Are Insiders Buying Hammerson plc (LON:HMSO) Stock?

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 Hammerson plc (LON:HMSO).

What Is Insider Selling?

It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, most countries require that the company discloses such transactions to the market.

We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Columbia University study found that 'insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers'.

See our latest analysis for Hammerson

The Last 12 Months Of Insider Transactions At Hammerson

The Independent Chairman of the Board David Tyler made the biggest insider purchase in the last 12 months. That single transaction was for UK£85k worth of shares at a price of UK£1.71 each. That means that an insider was happy to buy shares at above the current price of UK£0.80. 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.

In the last twelve months insiders purchased 115.84k shares for UK£185k. But they sold 20279 shares for UK£14k. In total, Hammerson insiders bought more than they sold over the last year. You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

Hammerson is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Are Hammerson Insiders Buying Or Selling?

We saw Insiders buy shares worth UK£14k in the last three months. However that only slightly eclipses the sales, UK£14k worth of sales. Overall, we don't think these recent trades are particularly informative, one way or the other.

Insider Ownership of Hammerson

Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 3.6% of Hammerson shares, worth about UK£22m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

What Might The Insider Transactions At Hammerson Tell Us?

Insider purchases may have been minimal, in the last three months, but there was no selling at all. That said, the purchases were not large. On a brighter note, the transactions over the last year are encouraging. Overall we don't see anything to make us think Hammerson insiders are doubting the company, and they do own shares. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Hammerson. Be aware that Hammerson is showing 3 warning signs in our investment analysis, and 1 of those is significant...

But note: Hammerson 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. 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.
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