Don't Ignore The Insider Selling In Croma Security Solutions Group

We'd be surprised if Croma Security Solutions Group plc (LON:CSSG) shareholders haven't noticed that the CEO & Executive Director, Roberto Fiorentino, recently sold UK£160k worth of stock at UK£0.85 per share. On the bright side, that sale was only 4.7% of their holding, so we doubt it's very meaningful, on its own.

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Croma Security Solutions Group Insider Transactions Over The Last Year

Notably, that recent sale by CEO & Executive Director Roberto Fiorentino was not the only time they traded Croma Security Solutions Group shares this year. Earlier in the year, they spent UK£332k to buy shares at UK£0.68 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of UK£0.85. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

In the last twelve months insiders purchased 548.72k shares for UK£380k. But they sold 678.87k shares for UK£492k. Roberto Fiorentino sold a total of 678.87k shares over the year at an average price of UK£0.72. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

Check out our latest analysis for Croma Security Solutions Group

I will like Croma Security Solutions Group better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Does Croma Security Solutions Group 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. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Croma Security Solutions Group insiders own about UK£5.2m worth of shares (which is 44% of the company). Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

What Might The Insider Transactions At Croma Security Solutions Group Tell Us?

Unfortunately, there has been more insider selling of Croma Security Solutions Group stock, than buying, in the last three months. Zooming out, the longer term picture doesn't give us much comfort. On the plus side, Croma Security Solutions Group makes money, and is growing profits. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Croma Security Solutions Group. In terms of investment risks, we've identified 3 warning signs with Croma Security Solutions Group and understanding these should be part of your investment process.

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.