Mphasis Insiders Sell ₹282m Of Stock, Possibly Signalling Caution

In the last year, many Mphasis Limited (NSE:MPHASIS) insiders sold a substantial stake in the company which may have sparked shareholders' attention. When evaluating insider transactions, knowing whether insiders are buying is usually more beneficial than knowing whether they are selling, as the latter can be open to many interpretations. However, if numerous insiders are selling, shareholders should investigate more.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

Mphasis Insider Transactions Over The Last Year

The President of Enterprise 5 - North Americas, R. Elango, made the biggest insider sale in the last 12 months. That single transaction was for ₹56m worth of shares at a price of ₹3,130 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 ₹2,500. So it is hard to draw any strong conclusion from it.

Insiders in Mphasis didn't buy any shares in 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!

Check out our latest analysis for Mphasis

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Insiders At Mphasis Have Sold Stock Recently

The last three months saw significant insider selling at Mphasis. Specifically, insiders ditched ₹20m worth of shares in that time, and we didn't record any purchases whatsoever. Overall this makes us a bit cautious, but it's not the be all and end all.

Insider Ownership

Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. Mphasis insiders own about ₹2.9b worth of shares. That equates to 0.6% 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.

What Might The Insider Transactions At Mphasis Tell Us?

Insiders sold Mphasis shares recently, but they didn't buy any. And even if we look at the last year, we didn't see any purchases. On the plus side, Mphasis makes money, and is growing profits. It is good to see high insider ownership, but the insider selling leaves us cautious. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Mphasis. At Simply Wall St, we found 1 warning sign for Mphasis that deserve your attention before buying any shares.

Of course Mphasis 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 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.