Don't Ignore The Fact That This Insider Just Sold Some Shares In Ramco Systems Limited (NSE:RAMCOSYS)

We note that a Ramco Systems Limited (NSE:RAMCOSYS) insider, Raghvendra Tripathi, recently sold ₹2.3m worth of stock for ₹512 per share. It wasn't a huge sale, but it did reduce their holding by 20%. This does not instill confidence.

View our latest analysis for Ramco Systems

Ramco Systems Insider Transactions Over The Last Year

Notably, that recent sale by Raghvendra Tripathi is the biggest insider sale of Ramco Systems shares that we've seen in the last year. So it's clear an insider wanted to take some cash off the table, even below the current price of ₹589. We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. 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 20% of Raghvendra Tripathi's holding.

In total, Ramco Systems insiders sold more than they bought 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!

I will like Ramco Systems better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

Does Ramco Systems 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. Ramco Systems insiders own about ₹3.6b worth of shares. That equates to 20% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

What Might The Insider Transactions At Ramco Systems Tell Us?

Insiders haven't bought Ramco Systems stock in the last three months, but there was some selling. Despite some insider buying, the longer term picture doesn't make us feel much more positive. But it is good to see that Ramco Systems is growing earnings. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. 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 2 warning signs for Ramco Systems that deserve your attention before buying any shares.

But note: Ramco Systems 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, but not derivative transactions.

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