We often see insiders buying up shares in companies that perform well over the long term. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So shareholders might well want to know whether insiders have been buying or selling shares in Irish Residential Properties REIT Plc (ISE:IRES).
What Is Insider Selling?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock on the market. However, such insiders must disclose their trading activities, and not trade on inside information.
We don’t think shareholders should simply follow insider transactions. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Columbia University study found that ‘insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers’.
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Irish Residential Properties REIT Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider purchase was by Independent Non-Executive Chairman Declan Moylan for €180k worth of shares, at about €1.56 per share. That implies that an insider found the current price of €1.59 per share to be enticing. That means they have been optimistic about the company in the past, though they may have changed their mind. We do always like to see insider buying, but it is worth noting if those purchases were made at well below today’s share price, as the discount to value may have narrowed with the rising price. The good news for Irish Residential Properties REIT share holders is that insiders were buying at near the current price. Notably Declan Moylan was also the biggest seller, having sold €98k worth of shares.
Happily, we note that in the last year insiders paid €322k for 213k shares. But they sold 65000 for €98k. In the last twelve months there was more buying than selling by Irish Residential Properties REIT insiders. The chart below shows insider transactions (by 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!
There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).
Insiders at Irish Residential Properties REIT Have Bought Stock Recently
At Irish Residential Properties REIT,over the last quarter, we have observed quite a lot more insider buying than insider selling. In total, Declan Moylan bought €180k worth of shares in that time. But we did see Declan Moylan sell shares worth €98k. The buying outweighs the selling, which suggests that insiders may believe the company will do well in the future.
Does Irish Residential Properties REIT Boast High Insider Ownership?
For a common shareholder, it is worth checking how many shares are held by company 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. From looking at our data, insiders own €1.5m worth of Irish Residential Properties REIT stock, about 0.2% of the company. We consider this fairly low insider ownership.
So What Does This Data Suggest About Irish Residential Properties REIT Insiders?
It is good to see the recent insider purchase. And an analysis of the transactions over the last year also gives us confidence. While the overall levels of insider ownership are below what we’d like to see, the history of transactions imply that Irish Residential Properties REIT insiders are reasonably well aligned, and optimistic for the future. Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for Irish Residential Properties REIT.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.