Trade Alert: CEO & Executive Director Of Smiths News Jonathan Bunting Has Sold Stock

Some Smiths News plc (LON:SNWS) shareholders may be a little concerned to see that the CEO & Executive Director, Jonathan Bunting, recently sold a substantial UK£717k worth of stock at a price of UK£0.61 per share. That sale reduced their total holding by 43% which is hardly insignificant, but far from the worst we've seen.

Check out our latest analysis for Smiths News

Smiths News Insider Transactions Over The Last Year

In fact, the recent sale by Jonathan Bunting was the biggest sale of Smiths News shares made by an insider individual in the last twelve months, according to our records. That means that an insider was selling shares at below the current price (UK£0.62). 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 43% of Jonathan Bunting's holding.

The chart below shows insider transactions (by companies and individuals) over the last year. 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 small cap stocks that are not only being bought by insiders but also have attractive valuations.

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. A high insider ownership often makes company leadership more mindful of shareholder interests. Our data suggests Smiths News insiders own 1.5% of the company, worth about UK£2.1m. We prefer to see high levels of insider ownership.

What Might The Insider Transactions At Smiths News Tell Us?

An insider hasn't bought Smiths News stock in the last three months, but there was some selling. And there weren't any purchases to give us comfort, over the last year. But it is good to see that Smiths News is growing earnings. When you combine this with the relatively low insider ownership, we are very cautious about the stock. We'd certainly practice some caution before buying! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Smiths News. Case in point: We've spotted 4 warning signs for Smiths News you should be aware of, and 1 of these can't be ignored.

But note: Smiths News 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.