Insiders At Sterling and Wilson Renewable Energy Sold ₹2.1b In Stock, Alluding To Potential Weakness

The fact that multiple Sterling and Wilson Renewable Energy Limited (NSE:SWSOLAR) insiders offloaded a considerable amount of shares over the past year could have raised some eyebrows amongst investors. When analyzing insider transactions, it is usually more valuable to know whether insiders are buying versus knowing if they are selling, as the latter sends an ambiguous message. However, if numerous insiders are selling, shareholders should investigate more.

While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

Check out our latest analysis for Sterling and Wilson Renewable Energy

The Last 12 Months Of Insider Transactions At Sterling and Wilson Renewable Energy

The Non-Executive & Non-Independent Chairman, Khurshed Daruvala, made the biggest insider sale in the last 12 months. That single transaction was for ₹2.0b worth of shares at a price of ₹630 each. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. It's of some comfort that this sale was conducted at a price well above the current share price, which is ₹448. So it may not shed much light on insider confidence at current levels.

Sterling and Wilson Renewable Energy insiders didn't buy any shares over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

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Sterling and Wilson Renewable Energy Insiders Are Selling The Stock

The last three months saw significant insider selling at Sterling and Wilson Renewable Energy. In total, insiders dumped ₹7.2m worth of shares in that time, and we didn't record any purchases whatsoever. Overall this makes us a bit cautious, but it's not the be all and end all.

Insider Ownership

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with 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. Sterling and Wilson Renewable Energy insiders own about ₹8.7b worth of shares (which is 8.3% 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 Does This Data Suggest About Sterling and Wilson Renewable Energy Insiders?

Insiders sold Sterling and Wilson Renewable Energy shares recently, but they didn't buy any. And even if we look at the last year, we didn't see any purchases. It is good to see high insider ownership, but the insider selling leaves us cautious. Therefore, you should definitely take a look at this FREE report showing analyst forecasts for Sterling and Wilson Renewable Energy.

But note: Sterling and Wilson Renewable Energy 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 of direct interests only, but not derivative transactions or indirect interests.

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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.