Edelweiss Financial Services Insiders Sell ₹47m Of Stock, Possibly Signalling Caution

Quite a few Edelweiss Financial Services Limited (NSE:EDELWEISS) insiders sold their shares over the past year, which may be a cause for concern. Knowing whether insiders are buying is usually more helpful when evaluating insider transactions, as insider selling can have various explanations. However, when multiple insiders sell stock over a specific duration, shareholders should take notice as that could possibly be a red flag.

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.

View our latest analysis for Edelweiss Financial Services

Edelweiss Financial Services Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the insider, Rujan Panjwani, for ₹23m worth of shares, at about ₹135 per share. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. The good news is that this large sale was at well above current price of ₹114. So it is hard to draw any strong conclusion from it.

In the last twelve months insiders purchased 137.70k shares for ₹9.4m. On the other hand they divested 352.50k shares, for ₹47m. All up, insiders sold more shares in Edelweiss Financial Services than they bought, over 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!

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: Most of them are flying under the radar).

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Edelweiss Financial Services insiders own 31% of the company, currently worth about ₹34b based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

What Might The Insider Transactions At Edelweiss Financial Services Tell Us?

The fact that there have been no Edelweiss Financial Services insider transactions recently certainly doesn't bother us. While we feel good about high insider ownership of Edelweiss Financial Services, we can't say the same about the selling of shares. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. Our analysis shows 4 warning signs for Edelweiss Financial Services (1 is concerning!) and we strongly recommend you look at them before investing.

Of course Edelweiss Financial Services 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.