We wouldn't blame Jet2 plc (LON:JET2) shareholders if they were a little worried about the fact that Philip Meeson, the Executive Chairman recently netted about UK£24m selling shares at an average price of UK£11.88. However, it's crucial to note that they remain very much invested in the stock and that sale only reduced their holding by 4.2%.
The Last 12 Months Of Insider Transactions At Jet2
Notably, that recent sale by Philip Meeson is the biggest insider sale of Jet2 shares that we've seen in the last year. That means that an insider was selling shares at slightly below the current price (UK£12.24). When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. This single sale was just 4.2% of Philip Meeson's stake.
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!
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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. It's great to see that Jet2 insiders own 22% of the company, worth about UK£587m. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
What Might The Insider Transactions At Jet2 Tell Us?
An insider sold Jet2 shares recently, but they didn't buy any. And even if we look at the last year, we didn't see any purchases. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. For instance, we've identified 4 warning signs for Jet2 (1 shouldn't be ignored) you should be aware of.
Of course Jet2 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, but not derivative transactions.
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