Globesecure Technologies Up 13%, But Some Insiders Miss Out

Globesecure Technologies Limited's (NSE:GSTL) stock rose 13% last week, but insiders who sold ₹40m worth of stock over the last year are probably in a more advantageous position. Holding on to stock would have meant their investment would be worth less now than it was at the time of sale. Thus selling at an average price of ₹34.25, which is higher than the current price, may have been the best decision.

While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.

We've found 21 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free.

The Last 12 Months Of Insider Transactions At Globesecure Technologies

In the last twelve months, the biggest single sale by an insider was when the MD & Chairman, Ragavan Rajkumar, sold ₹21m worth of shares at a price of ₹39.39 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 good news is that this large sale was at well above current price of ₹12.60. So it is hard to draw any strong conclusion from it. The only individual insider seller over the last year was Ragavan Rajkumar. Notably Ragavan Rajkumar was also the biggest buyer, having purchased ₹256k worth of shares.

Ragavan Rajkumar ditched 1.16m shares over the year. The average price per share was ₹34.25. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

See our latest analysis for Globesecure Technologies

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.

Does Globesecure Technologies Boast High Insider Ownership?

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. We usually like to see fairly high levels of insider ownership. Globesecure Technologies insiders own 55% of the company, currently worth about ₹63m based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Does This Data Suggest About Globesecure Technologies Insiders?

It doesn't really mean much that no insider has traded Globesecure Technologies shares in the last quarter. While we feel good about high insider ownership of Globesecure Technologies, 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. When we did our research, we found 3 warning signs for Globesecure Technologies (2 shouldn't be ignored!) that we believe deserve your full attention.

But note: Globesecure Technologies 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.