How Much Are Monte Carlo Fashions Limited (NSE:MONTECARLO) Insiders Spending On Buying Shares?

It is not uncommon to see companies perform well in the years after insiders buy shares. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So we'll take a look at whether insiders have been buying or selling shares in Monte Carlo Fashions Limited (NSE:MONTECARLO).

What Is Insider Buying?

It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. 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 it is perfectly logical to keep tabs on what insiders are doing. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise'.

View our latest analysis for Monte Carlo Fashions

Monte Carlo Fashions Insider Transactions Over The Last Year

The Executive Director Monica Oswal made the biggest insider purchase in the last 12 months. That single transaction was for ₹15m worth of shares at a price of ₹203 each. That means that an insider was happy to buy shares at around the current price of ₹224. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. While we always like to see insider buying, it's less meaningful if the purchases were made at much lower prices, as the opportunity they saw may have passed. Happily, the Monte Carlo Fashions insiders decided to buy shares at close to current prices.

Monte Carlo Fashions insiders may have bought shares in the last year, but they didn't sell any. 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!

Monte Carlo Fashions is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

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. I reckon it's a good sign if insiders own a significant number of shares in the company. Our data indicates that Monte Carlo Fashions insiders own about ₹266m worth of shares (which is 5.5% of the company). But they may have an indirect interest through a corporate structure that we haven't picked up on. Whilst better than nothing, we're not overly impressed by these holdings.

So What Do The Monte Carlo Fashions Insider Transactions Indicate?

The fact that there have been no Monte Carlo Fashions insider transactions recently certainly doesn't bother us. But insiders have shown more of an appetite for the stock, over the last year. With high insider ownership and encouraging transactions, it seems like Monte Carlo Fashions insiders think the business has merit. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Monte Carlo Fashions. Every company has risks, and we've spotted 2 warning signs for Monte Carlo Fashions you should know about.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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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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. 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.
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