Non-Independent Non-Executive Director Andrew Stone Just Sold A Bunch Of Shares In Gamma Communications plc (LON:GAMA)

By
Simply Wall St
Published
April 11, 2021
AIM:GAMA
Source: Shutterstock

Some Gamma Communications plc (LON:GAMA) shareholders may be a little concerned to see that the Non-Independent Non-Executive Director, Andrew Stone, recently sold a substantial UK£3.5m worth of stock at a price of UK£17.70 per share. That sale reduced their total holding by 48% which is hardly insignificant, but far from the worst we've seen.

View our latest analysis for Gamma Communications

The Last 12 Months Of Insider Transactions At Gamma Communications

Notably, that recent sale by Andrew Stone is the biggest insider sale of Gamma Communications shares that we've seen in the last year. That means that an insider was selling shares at around the current price of UK£17.80. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. Given that the sale took place at around current prices, it makes us a little cautious but is hardly a major concern.

In the last twelve months insiders purchased 5.02k shares for UK£83k. On the other hand they divested 715.15k shares, for UK£12m. Andrew Stone sold a total of 715.15k shares over the year at an average price of UK£16.28. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

insider-trading-volume
AIM:GAMA Insider Trading Volume April 12th 2021

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).

Insider Ownership of Gamma Communications

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 0.7% of Gamma Communications shares, worth about UK£11m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

What Might The Insider Transactions At Gamma Communications Tell Us?

The stark truth for Gamma Communications is that there has been more insider selling than insider buying in the last three months. And our longer term analysis of insider transactions didn't bring confidence, either. But it is good to see that Gamma Communications is growing earnings. Insiders own shares, but we're still pretty cautious, given the history of sales. So we'd only buy after careful consideration. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Gamma Communications. Case in point: We've spotted 2 warning signs for Gamma Communications you should be aware of.

But note: Gamma Communications 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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