Inchcape Insiders Added UK£479.3k Of Stock To Their Holdings

When a single insider purchases stock, it is typically not a major deal. However, when multiple insiders purchase stock, like in Inchcape plc's (LON:INCH) instance, it's good news for shareholders.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

Check out our latest analysis for Inchcape

The Last 12 Months Of Insider Transactions At Inchcape

The Group CEO & Director, Duncan Tait, made the biggest insider sale in the last 12 months. That single transaction was for UK£323k worth of shares at a price of UK£7.61 each. That means that an insider was selling shares at slightly below the current price (UK£7.91). We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. However, while insider selling is sometimes discouraging, it's only a weak signal. We note that the biggest single sale was only 15% of Duncan Tait's holding. The only individual insider seller over the last year was Duncan Tait.

In the last twelve months insiders purchased 72.46k shares for UK£479k. On the other hand they divested 42.45k shares, for UK£323k. In the last twelve months there was more buying than selling by Inchcape insiders. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).

Does Inchcape Boast High Insider Ownership?

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. Inchcape insiders own about UK£61m worth of shares. That equates to 1.9% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Do The Inchcape Insider Transactions Indicate?

The fact that there have been no Inchcape insider transactions recently certainly doesn't bother us. But insiders have shown more of an appetite for the stock, over the last year. Overall we don't see anything to make us think Inchcape insiders are doubting the company, and they do own shares. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. To that end, you should learn about the 2 warning signs we've spotted with Inchcape (including 1 which is a bit concerning).

But note: Inchcape 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 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com