Trade Alert: The Deputy CEO & CFO Of Tomra Systems ASA (OB:TOM), Espen Gundersen, Has Sold Some Shares Recently

We wouldn't blame Tomra Systems ASA (OB:TOM) shareholders if they were a little worried about the fact that Espen Gundersen, the Deputy CEO & CFO recently netted about kr9.5m selling shares at an average price of kr383. That's a big disposal, and it decreased their holding size by 40%, which is notable but not too bad.

Check out our latest analysis for Tomra Systems

Tomra Systems Insider Transactions Over The Last Year

Notably, that recent sale by Espen Gundersen is the biggest insider sale of Tomra Systems shares that we've seen in the last year. That means that even when the share price was slightly below the current price of kr386, an insider wanted to cash in some shares. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. It is worth noting that this sale was only 40% of Espen Gundersen's holding.

Happily, we note that in the last year insiders paid kr386k for 1.15k shares. But they sold 24.80k shares for kr9.5m. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

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Does Tomra 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. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 0.3% of Tomra Systems shares, worth about kr158m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Does This Data Suggest About Tomra Systems Insiders?

An insider sold Tomra Systems shares recently, but they didn't buy any. Despite some insider buying, the longer term picture doesn't make us feel much more positive. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. In terms of investment risks, we've identified 1 warning sign with Tomra Systems and understanding this should be part of your investment process.

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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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