Don’t Ignore The Fact That This Insider Just Sold Some Shares In The Unite Group plc (LON:UTG)

Anyone interested in The Unite Group plc (LON:UTG) should probably be aware that the CEO & Director, Richard Smith, recently divested UK£406k worth of shares in the company, at an average price of UK£10.43 each. That sale was 14.7% of their holding, so it does make us raise an eyebrow.

View our latest analysis for Unite Group

Unite Group Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the CFO & Director, Joseph Lister, for UK£638k worth of shares, at about UK£9.12 per share. That means that an insider was selling shares at slightly below the current price (UK£10.11). When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. However, while insider selling is sometimes discouraging, it’s only a weak signal. It is worth noting that this sale was only 13.6% of Joseph Lister’s holding.

Over the last year, we note insiders sold 144k shares worth UK£1.4m. Insiders in Unite Group didn’t buy any shares in the last year. You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

LSE:UTG Recent Insider Trading, August 5th 2019
LSE:UTG Recent Insider Trading, August 5th 2019

Insider Ownership of Unite Group

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. Unite Group insiders own about UK£10m worth of shares. That equates to 0.3% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Does This Data Suggest About Unite Group Insiders?

An insider sold Unite Group shares recently, but they didn’t buy any. And there weren’t any purchases to give us comfort, over the last year. Insider ownership isn’t particularly high, so this analysis makes us cautious about the company. We’d think twice before buying! Of course, the future is what matters most. So if you are interested in Unite Group, you should check out this free report on analyst forecasts for the company.

Of course Unite Group may not be the best stock to buy. So you may wish to see this free collection of high quality 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, but not derivative transactions.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.