Possible Bearish Signals With Fisher & Paykel Healthcare Insiders Disposing Stock

The fact that multiple Fisher & Paykel Healthcare Corporation Limited (NZSE:FPH) insiders offloaded a considerable amount of shares over the past year could have raised some eyebrows amongst investors. Knowing whether insiders are buying is usually more helpful when evaluating insider transactions, as insider selling can have various explanations. However, if numerous insiders are selling, shareholders should investigate more.

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.

Our free stock report includes 2 warning signs investors should be aware of before investing in Fisher & Paykel Healthcare. Read for free now.

Fisher & Paykel Healthcare Insider Transactions Over The Last Year

The MD, CEO & Executive Director, Lewis Gradon, made the biggest insider sale in the last 12 months. That single transaction was for NZ$1.8m worth of shares at a price of NZ$38.48 each. While we don't usually like to see insider selling, it's more concerning if the sales take place 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 NZ$34.30. So it is hard to draw any strong conclusion from it.

Happily, we note that in the last year insiders paid NZ$56k for 1.50k shares. But insiders sold 149.91k shares worth NZ$5.5m. Over the last year we saw more insider selling of Fisher & Paykel Healthcare shares, than buying. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

Check out our latest analysis for Fisher & Paykel Healthcare

If you are like me, then you will not want to miss this free list of small cap stocks that are not only being bought by insiders but also have attractive valuations.

Does Fisher & Paykel Healthcare Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 0.4% of Fisher & Paykel Healthcare shares, worth about NZ$78m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Do The Fisher & Paykel Healthcare Insider Transactions Indicate?

It doesn't really mean much that no insider has traded Fisher & Paykel Healthcare shares in the last quarter. We don't take much encouragement from the transactions by Fisher & Paykel Healthcare insiders. But we do like the fact that insiders own a fair chunk of 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. Case in point: We've spotted 2 warning signs for Fisher & Paykel Healthcare you should be aware of.

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 of direct interests only, but not derivative transactions or indirect interests.

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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.