This Insider Has Just Sold Shares In NIIT

Investors may wish to note that an insider of NIIT Limited, Rajan Venkataraman, recently netted ₹8.2m from selling stock, receiving an average price of ₹163. While that isn't a lot of money, it was a substantial 100% of their holding, so certainly isn't a good sign.

Check out our latest analysis for NIIT

NIIT Insider Transactions Over The Last Year

The Non-Executive director, Sapnesh Lalla, made the biggest insider sale in the last 12 months. That single transaction was for ₹16m worth of shares at a price of ₹116 each. That means that even when the share price was below the current price of ₹189, an insider wanted to cash in some shares. We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. It is worth noting that this sale was only 25% of Sapnesh Lalla's holding.

Insiders in NIIT didn't buy any shares in the last year. The chart below shows insider transactions (by companies and 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!

For those who like to find hidden gems this free list of small cap companies with recent insider purchasing, could be just the ticket.

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. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. NIIT insiders own 42% of the company, currently worth about ₹11b based on the recent share price. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

What Might The Insider Transactions At NIIT Tell Us?

Insiders haven't bought NIIT stock in the last three months, but there was some selling. Looking to the last twelve months, our data doesn't show any insider buying. On the plus side, NIIT makes money, and is growing profits. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. 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 example, NIIT has 3 warning signs (and 1 which is concerning) we think you should know about.

Of course NIIT 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.

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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.