Don't Ignore The Insider Selling In Raspberry Pi Holdings

We'd be surprised if Raspberry Pi Holdings plc (LON:RPI) shareholders haven't noticed that the Founder, Eben Upton, recently sold UK£186k worth of stock at UK£6.20 per share. On the bright side, that sale was only 0.8% of their holding, so we doubt it's very meaningful, on its own.

View our latest analysis for Raspberry Pi Holdings

Raspberry Pi Holdings Insider Transactions Over The Last Year

In fact, the recent sale by Eben Upton was the biggest sale of Raspberry Pi Holdings shares made by an insider individual in the last twelve months, according to our records. That means that an insider was selling shares at slightly below the current price (UK£6.54). 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 0.8% of Eben Upton's holding.

The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

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

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. We usually like to see fairly high levels of insider ownership. Insiders own 2.3% of Raspberry Pi Holdings shares, worth about UK£29m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Does This Data Suggest About Raspberry Pi Holdings Insiders?

An insider sold Raspberry Pi Holdings shares recently, but they didn't buy any. Looking to the last twelve months, our data doesn't show any insider buying. But it is good to see that Raspberry Pi Holdings is growing earnings. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. We're in no rush to buy! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For example, Raspberry Pi Holdings has 3 warning signs (and 1 which doesn't sit too well with us) we think you should know about.

Of course Raspberry Pi Holdings may not be the best stock to buy. So you may wish to see this free collection of high quality 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.