How Much Are Hester Biosciences Limited (NSE:HESTERBIO) Insiders Taking Off The Table?

We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sell Hester Biosciences Limited (NSE:HESTERBIO), you may well want to know whether insiders have been buying or selling.

What Is Insider Selling?

Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock in the company. However, most countries require that the company discloses such transactions to the market.

Insider transactions are not the most important thing when it comes to long-term investing. But it is perfectly logical to keep tabs on what insiders are doing. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year'.

Check out our latest analysis for Hester Biosciences

The Last 12 Months Of Insider Transactions At Hester Biosciences

The insider, Madhuri Kapadia, made the biggest insider sale in the last 12 months. That single transaction was for ₹56m worth of shares at a price of ₹1,861 each. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. It's of some comfort that this sale was conducted at a price well above the current share price, which is ₹1,400. So it is hard to draw any strong conclusion from it. Madhuri Kapadia was the only individual insider to sell shares in the last twelve months.

In the last twelve months insiders purchased 168.00 shares for ₹232k. But insiders sold 30.75k shares worth ₹57m. Madhuri Kapadia sold a total of 30.75k shares over the year at an average price of ₹1,858. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

I will like Hester Biosciences better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

Insider Ownership

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. I reckon it's a good sign if insiders own a significant number of shares in the company. It's great to see that Hester Biosciences insiders own 63% of the company, worth about ₹7.4b. 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 Hester Biosciences Tell Us?

It doesn't really mean much that no insider has traded Hester Biosciences 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 Hester Biosciences insider transactions don't fill us with confidence. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. In terms of investment risks, we've identified 2 warning signs with Hester Biosciences and understanding them should be part of your investment process.

Of course Hester Biosciences 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, but not derivative transactions.

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