Insider Sellers Might Regret Selling ideaForge Technology Shares at a Lower Price Than Current Market Value

Even though ideaForge Technology Limited (NSE:IDEAFORGE) has fallen by 16% over the past week , insiders who sold ₹238m worth of stock over the past year have had less luck. Given that the average selling price of ₹774 is still lower than the current share price, insiders would probably have been better off keeping their shares.

While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.

See our latest analysis for ideaForge Technology

ideaForge Technology Insider Transactions Over The Last Year

The Non-Executive Nominee Director, Ganapathy Subramaniam, made the biggest insider sale in the last 12 months. That single transaction was for ₹88m worth of shares at a price of ₹857 each. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. The silver lining is that this sell-down took place above the latest price (₹482). So it is hard to draw any strong conclusion from it.

ideaForge Technology insiders didn't buy any shares over the last year. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

I will like ideaForge Technology better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

ideaForge Technology Insiders Are Selling The Stock

The last three months saw significant insider selling at ideaForge Technology. In total, insiders sold ₹11m worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.

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. ideaForge Technology insiders own about ₹8.8b worth of shares (which is 42% of the company). Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Do The ideaForge Technology Insider Transactions Indicate?

Insiders sold stock recently, but they haven't been buying. And even if we look at the last year, we didn't see any purchases. But since ideaForge Technology is profitable and growing, we're not too worried by this. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing ideaForge Technology. When we did our research, we found 2 warning signs for ideaForge Technology (1 is significant!) that we believe deserve your full attention.

Of course ideaForge Technology 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.