Selling Allied Digital Services Shares at a Lower Price Than Current Market Value May Have Been a Costly Mistake for Insiders

Allied Digital Services Limited's (NSE:ADSL) value has fallen 10% in the last week, but insiders who sold ₹54m worth of stock over the last year have had less success. Insiders would probably have been better off holding on to their shares given that the average selling price of ₹207 is still lower than the current share price.

Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.

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Allied Digital Services Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the insider, Hubert Wong, for ₹19m worth of shares, at about ₹301 per share. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. The silver lining is that this sell-down took place above the latest price (₹159). So it may not shed much light on insider confidence at current levels.

Insiders in Allied Digital Services 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. By clicking on the graph below, you can see the precise details of each insider transaction!

See our latest analysis for Allied Digital Services

I will like Allied Digital Services 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.

Does Allied Digital Services Boast High Insider Ownership?

Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Allied Digital Services insiders own about ₹4.7b worth of shares (which is 52% of the company). I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Does This Data Suggest About Allied Digital Services Insiders?

The fact that there have been no Allied Digital Services insider transactions recently certainly doesn't bother us. While we feel good about high insider ownership of Allied Digital Services, we can't say the same about the selling of shares. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. At Simply Wall St, we found 1 warning sign for Allied Digital Services that deserve your attention before buying any shares.

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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.