It is not uncommon to see companies perform well in the years after insiders buy shares. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sell Fisher & Paykel Healthcare Corporation Limited (NZSE:FPH), you may well want to know whether insiders have been buying or selling.
What Is Insider Selling?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, such insiders must disclose their trading activities, and not trade on inside information.
We don’t think shareholders should simply follow insider transactions. But equally, we would consider it foolish to ignore insider transactions altogether. As Peter Lynch said, ‘insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.
The Last 12 Months Of Insider Transactions At Fisher & Paykel Healthcare
While no particular insider transaction stood out, we can still look at the overall trading.
While Fisher & Paykel Healthcare insiders bought shares last year, they didn’t sell. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Fisher & Paykel Healthcare is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Insiders at Fisher & Paykel Healthcare Have Bought Stock Recently
Over the last quarter, Fisher & Paykel Healthcare insiders have spent a meaningful amount on shares. Not only was there no selling that we can see, but they collectively bought NZ$88k worth of shares. This could be interpreted as suggesting a positive outlook.
Insider Ownership of Fisher & Paykel Healthcare
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. A high insider ownership often makes company leadership more mindful of shareholder interests. Fisher & Paykel Healthcare insiders own about NZ$58m worth of shares. That equates to 0.4% 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.
So What Do The Fisher & Paykel Healthcare Insider Transactions Indicate?
It’s certainly positive to see the recent insider purchases. We also take confidence from the longer term picture of insider transactions. Given that insiders also own a fair bit of Fisher & Paykel Healthcare we think they are probably pretty confident of a bright future. Of course, the future is what matters most. So if you are interested in Fisher & Paykel Healthcare, you should check out this free report on analyst forecasts for the company.
Of course Fisher & Paykel Healthcare 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.
If you spot an error that warrants correction, please contact the editor at email@example.com. 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. Simply Wall St has no position in the stocks mentioned.
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