Have Ethos Insiders Been Selling Stock?

Some Ethos Limited (NSE:ETHOSLTD) shareholders may be a little concerned to see that the MD & Director, Yashovardhan Saboo, recently sold a substantial ₹60m worth of stock at a price of ₹2,416 per share. That sale reduced their total holding by 24% which is hardly insignificant, but far from the worst we've seen.

See our latest analysis for Ethos

Ethos Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the CEO, Additional MD & Director, Pranav Saboo, sold ₹202m worth of shares at a price of ₹2,016 per share. That means that an insider was selling shares at slightly below the current price (₹2,554). As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. We note that the biggest single sale was 100% of Pranav Saboo's holding.

Insiders in Ethos didn't buy any shares in 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!

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Insider Ownership Of Ethos

For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Ethos insiders own about ₹3.1b worth of shares. That equates to 5.1% of the company. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Does This Data Suggest About Ethos Insiders?

Insiders sold stock recently, but they haven't been buying. And even if we look at the last year, we didn't see any purchases. But it is good to see that Ethos is growing earnings. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Ethos. Every company has risks, and we've spotted 2 warning signs for Ethos you should know about.

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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.