Should You Be Worried About Insider Transactions At Exor N.V. (BIT:EXO)?

We’ve lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So we’ll take a look at whether insiders have been buying or selling shares in Exor N.V. (BIT:EXO).

What Is Insider Buying?

Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock in the company. However, rules govern insider transactions, and certain disclosures are required.

We don’t think shareholders should simply follow insider transactions. But it is perfectly logical to keep tabs on what insiders are doing. For example, a Columbia University study found that ‘insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers’.

See our latest analysis for Exor

The Last 12 Months Of Insider Transactions At Exor

The Chairman & CEO, John Elkann, made the biggest insider sale in the last 12 months. That single transaction was for €9.7m worth of shares at a price of €60.80 each. We generally don’t like to see insider selling, but the lower the sale price, the more it concerns us. The good news is that this large sale was at well above current price of €46.17. So it may not shed much light on insider confidence at current levels. John Elkann was the only individual insider to sell over the last year. Notably John Elkann was also the biggest buyer, having purchased €1.0m worth of shares.

John Elkann ditched 473732 shares over the year. The average price per share was €60.76. You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

BIT:EXO Recent Insider Trading May 24th 2020
BIT:EXO Recent Insider Trading May 24th 2020

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: insiders have been buying them).

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. I reckon it’s a good sign if insiders own a significant number of shares in the company. From what we can see in our data, insiders own only about €176k worth of Exor shares. However, it’s possible that insiders might have an indirect interest through a more complex structure. This level of insider ownership is notably low, and not very encouraging.

What Might The Insider Transactions At Exor Tell Us?

It doesn’t really mean much that no insider has traded Exor shares in the last quarter. Our analysis of Exor insider transactions leaves us unenthusiastic. We also note that, as far as we can see, insider ownership is fairly low, compared to other companies. In addition to knowing about insider transactions going on, it’s beneficial to identify the risks facing Exor. When we did our research, we found 2 warning signs for Exor (1 is significant!) that we believe deserve your full attention.

Of course Exor 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. 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. Thank you for reading.