Insiders Sold Kamdhenu At ₹624, Meanwhile Stock Sits Near ₹444

Despite the fact that Kamdhenu Limited's (NSE:KAMDHENU) value has dropped 14% in the last week insiders who sold ₹20m 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 ₹624 is still below the current share price.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

View our latest analysis for Kamdhenu

Kamdhenu Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the insider, Vivek Maheshwari, for ₹9.2m worth of shares, at about ₹615 per share. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The silver lining is that this sell-down took place above the latest price (₹444). So it may not shed much light on insider confidence at current levels.

In total, Kamdhenu insiders sold more 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!

I will like Kamdhenu better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Kamdhenu Insiders Are Selling The Stock

The last quarter saw substantial insider selling of Kamdhenu shares. Specifically, insiders ditched ₹20m 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 Of Kamdhenu

Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Kamdhenu insiders own about ₹6.5b worth of shares (which is 53% 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 Do The Kamdhenu Insider Transactions Indicate?

Insiders haven't bought Kamdhenu stock in the last three months, but there was some selling. And our longer term analysis of insider transactions didn't bring confidence, either. On the plus side, Kamdhenu makes money, and is growing profits. It is good to see high insider ownership, but the insider selling leaves us cautious. 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 - Kamdhenu has 4 warning signs we think you should be aware of.

Of course Kamdhenu 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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