Stock Analysis

The Founder of essensys plc (LON:ESYS), Mark Furness, Just Bought 1.8% More Shares

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Investors who take an interest in essensys plc (LON:ESYS) should definitely note that the Founder, Mark Furness, recently paid UK£0.75 per share to buy UK£261k worth of the stock. Although the purchase only increased their holding by 1.8%, it is still a solid purchase in our view.

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essensys Insider Transactions Over The Last Year

Notably, that recent purchase by Founder Mark Furness was not the only time they traded essensys shares this year. They previously made a sale of -UK£6.3m worth of shares at a price of UK£2.85 per share. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. The good news is that this large sale was at well above current price of UK£0.80. So it may not tell us anything about how insiders feel about the current share price.

Happily, we note that in the last year insiders paid UK£536k for 513.64k shares. But insiders sold 2.38m shares worth UK£6.7m. In total, essensys insiders sold more than they bought over the last year. The average sell price was around UK£2.83. We are not joyful about insider selling. However, we do note that the average sale price was significantly higher than the current share price (which is UK£0.80). You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

AIM:ESYS Insider Trading Volume March 21st 2022

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

Insider Ownership of essensys

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. Insiders own 33% of essensys shares, worth about UK£17m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

What Might The Insider Transactions At essensys Tell Us?

The recent insider purchases are heartening. On the other hand the transaction history, over the last year, isn't so positive. While recent transactions indicate confidence in essensys, insiders don't own enough of the company to overcome our cautiousness about the longer term transactions. Overall they seem reasonably aligned. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. When we did our research, we found 5 warning signs for essensys (1 is concerning!) that we believe deserve your full attention.

But note: essensys 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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essensys plc, together with its subsidiaries, engages in the provision of mission-critical software-as-a-service platforms and on-demand cloud services to the flexible workspace segment of the commercial real estate industry in the United Kingdom, Europe, North America, and the Asia-Pacific region.

Adequate balance sheet and fair value.