Insiders At Compuage Infocom Sold ₹66m Of Stock Potentially Indicating Weakness \

While Compuage Infocom Limited (NSE:COMPINFO) shareholders have had a good week with the stock up 23%, they shouldn't let their guards down. In spite of the relatively cheap prices, insiders made the decision to sell ₹66m worth of stock in the last 12 months. This could be a warning indicator of vulnerabilities in the future.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

See our latest analysis for Compuage Infocom

The Last 12 Months Of Insider Transactions At Compuage Infocom

Over the last year, we can see that the biggest insider sale was by the insider, Ajay Mehta, for ₹22m worth of shares, at about ₹22.00 per share. While insider selling is a negative, to us, it is more negative if the shares are sold 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 ₹15.95. So it is hard to draw any strong conclusion from it. The only individual insider seller over the last year was Ajay Mehta.

Ajay Mehta ditched 2.93m shares over the year. The average price per share was ₹22.59. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

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Insider Ownership Of Compuage Infocom

Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Compuage Infocom insiders own 48% of the company, currently worth about ₹658m 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 Do The Compuage Infocom Insider Transactions Indicate?

It doesn't really mean much that no insider has traded Compuage Infocom shares in the last quarter. While we feel good about high insider ownership of Compuage Infocom, we can't say the same about the selling of shares. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. At Simply Wall St, we've found that Compuage Infocom has 5 warning signs (1 is significant!) that deserve your attention before going any further with your analysis.

Of course Compuage Infocom 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, but not derivative transactions.

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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.