Parsvnath Developers Insiders Benefit From Selling Stock At ₹19.00

While Parsvnath Developers Limited (NSE:PARSVNATH) shareholders have had a good week with the stock up 18%, they shouldn't let their guards down. Even though stock prices were relatively low, insiders elected to sell ₹19m worth of stock in the last year, which could indicate some expected downturn.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

This technology could replace computers: discover the 20 stocks are working to make quantum computing a reality.

Parsvnath Developers Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the Founder & Chairman, Pradeep Jain, for ₹19m worth of shares, at about ₹19.00 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of ₹22.60. 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 0.6% of Pradeep Jain's holding. Pradeep Jain was the only individual insider to sell over the last year.

You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

See our latest analysis for Parsvnath Developers

If you are like me, then you will not want to miss this free list of small cap stocks that are not only being bought by insiders but also have attractive valuations.

Insider Ownership Of Parsvnath Developers

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. Parsvnath Developers insiders own about ₹4.4b worth of shares (which is 44% 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 Parsvnath Developers Insider Transactions Indicate?

It doesn't really mean much that no insider has traded Parsvnath Developers shares in the last quarter. It's great to see high levels of insider ownership, but looking back over the last year, we don't gain confidence from the Parsvnath Developers insiders selling. 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 - Parsvnath Developers has 2 warning signs we think you should be aware of.

But note: Parsvnath Developers may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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 of direct interests only, but not derivative transactions or indirect interests.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.