Have Insiders Sold Midwich Group plc (LON:MIDW) Shares Recently?

By
Simply Wall St
Published
September 10, 2021
AIM:MIDW
Source: Shutterstock

We wouldn't blame Midwich Group plc (LON:MIDW) shareholders if they were a little worried about the fact that Stephen Fenby, the Group MD & Director recently netted about UK£12m selling shares at an average price of UK£6.08. That's a big disposal, and it decreased their holding size by 10%, which is notable but not too bad.

See our latest analysis for Midwich Group

Midwich Group Insider Transactions Over The Last Year

Notably, that recent sale by Stephen Fenby is the biggest insider sale of Midwich Group shares that we've seen in the last year. So it's clear an insider wanted to take some cash off the table, even slightly below the current price of UK£6.15. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. We note that the biggest single sale was only 10%of Stephen Fenby's holding.

Happily, we note that in the last year insiders paid UK£267k for 82.00k shares. But insiders sold 2.00m shares worth UK£12m. 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!

insider-trading-volume
AIM:MIDW Insider Trading Volume September 11th 2021

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

Insider Ownership

Many investors like to check how much of a company is owned by insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It's great to see that Midwich Group insiders own 23% of the company, worth about UK£126m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

What Might The Insider Transactions At Midwich Group Tell Us?

An insider sold stock recently, but they haven't been buying. And our longer term analysis of insider transactions didn't bring confidence, either. 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. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. For example - Midwich Group has 4 warning signs we think you should be aware of.

But note: Midwich Group 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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