Triveni Engineering & Industries Limited's (NSE:TRIVENI) insiders who sold earlier this year may be offered solace in this recent price drop

Despite the fact that Triveni Engineering & Industries Limited's (NSE:TRIVENI) value has dropped 8.6% in the last week insiders who sold ₹258m worth of stock in the past 12 months have had less success. Insiders might have been better off holding onto their shares, given that the average selling price of ₹258 is still below the current share price.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

Check out our latest analysis for Triveni Engineering & Industries

Triveni Engineering & Industries Insider Transactions Over The Last Year

The Chairman & MD, Dhruv Sawhney, made the biggest insider sale in the last 12 months. That single transaction was for ₹258m worth of shares at a price of ₹258 each. That means that even when the share price was below the current price of ₹315, an insider wanted to cash in some shares. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. It is worth noting that this sale was only 1.8% of Dhruv Sawhney's holding. Dhruv Sawhney was the only individual insider to sell 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 click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

If you are like me, then you will not want to miss this free list of growing companies that insiders are 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. Triveni Engineering & Industries insiders own 40% of the company, currently worth about ₹30b 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 Triveni Engineering & Industries Tell Us?

It doesn't really mean much that no insider has traded Triveni Engineering & Industries shares in the last quarter. It's heartening that insiders own plenty of stock, but we'd like to see more insider buying, since the last year of Triveni Engineering & Industries insider transactions don't fill us with confidence. While we like knowing 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. For example - Triveni Engineering & Industries has 2 warning signs we think you should be aware of.

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. 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.