One Spirent Communications plc (LON:SPT) insider reduced their stake by 27% in the previous year

By
Simply Wall St
Published
November 18, 2021
LSE:SPT
Source: Shutterstock

Viewing insider transactions for Spirent Communications plc's (LON:SPT ) over the last year, we see that insiders were net sellers. This means that a larger number of shares were sold by insiders in relation to shares purchased.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

Check out our latest analysis for Spirent Communications

Spirent Communications Insider Transactions Over The Last Year

The Chief Financial & Operations Officer and Executive Director, Paula Bell, made the biggest insider sale in the last 12 months. That single transaction was for UK£406k worth of shares at a price of UK£2.90 each. So what is clear is that an insider saw fit to sell at around the current price of UK£2.80. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. We note that this sale took place at around the current price, so it isn't a major concern, though it's hardly a good sign. Paula Bell was the only individual insider to sell shares in the last twelve months.

In the last twelve months insiders purchased 10.05k shares for UK£26k. But insiders sold 140.00k shares worth UK£406k. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

insider-trading-volume
LSE:SPT Insider Trading Volume November 19th 2021

For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

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. I reckon it's a good sign if insiders own a significant number of shares in the company. Based on our data, Spirent Communications insiders have about 0.1% of the stock, worth approximately UK£2.4m. We prefer to see high levels of insider ownership.

What Might The Insider Transactions At Spirent Communications Tell Us?

There haven't been any insider transactions in the last three months -- that doesn't mean much. Our analysis of Spirent Communications insider transactions leaves us unenthusiastic. We also note that, as far as we can see, insider ownership is fairly low, compared to other companies. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Every company has risks, and we've spotted 1 warning sign for Spirent Communications you should know about.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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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