Insiders At Bytes Technology Group Sold UK£6.1m In Stock, Alluding To Potential Weakness

Over the past year, many Bytes Technology Group plc (LON:BYIT) insiders sold a significant stake in the company which may have piqued investors' interest. Knowing whether insiders are buying is usually more helpful when evaluating insider transactions, as insider selling can have various explanations. However, when multiple insiders sell stock over a specific duration, shareholders should take notice as that could possibly be a red flag.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

View our latest analysis for Bytes Technology Group

The Last 12 Months Of Insider Transactions At Bytes Technology Group

Over the last year, we can see that the biggest insider sale was by the insider, Neil Murphy, for UK£4.7m worth of shares, at about UK£5.00 per share. That means that even when the share price was below the current price of UK£5.73, an insider wanted to cash in some shares. 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. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. This single sale was just 25% of Neil Murphy's stake. Notably Neil Murphy was also the biggest buyer, having purchased UK£382k worth of shares.

In the last twelve months insiders purchased 68.59k shares for UK£382k. But they sold 1.20m shares for UK£6.1m. In total, Bytes Technology Group insiders sold more than they bought over the last year. You can see the insider transactions (by companies and 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!

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: insiders have been buying them).

Insiders At Bytes Technology Group Have Bought Stock Recently

We saw some Bytes Technology Group insider buying shares in the last three months. Phoenix MD Sam Mudd bought UK£28k worth of shares in that time. It's great to see that insiders are only buying, not selling. But in this case the amount purchased means the recent transaction may not be very meaningful on its own.

Insider Ownership

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. We usually like to see fairly high levels of insider ownership. Insiders own 1.6% of Bytes Technology Group shares, worth about UK£22m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Does This Data Suggest About Bytes Technology Group Insiders?

Our data shows a little insider buying, but no selling, in the last three months. That said, the purchases were not large. Still, the insider transactions at Bytes Technology Group in the last 12 months are not very heartening. The modest level of insider ownership is, at least, some comfort. 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. Every company has risks, and we've spotted 1 warning sign for Bytes Technology Group you should know about.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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 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.