Possible Bearish Signals With Bergman & Beving Insiders Disposing Stock

In the last year, many Bergman & Beving AB (publ) (STO:BERG B) insiders sold a substantial stake in the company which may have sparked shareholders' attention. When evaluating insider transactions, knowing whether insiders are buying is usually more beneficial than knowing whether they are selling, as the latter can be open to many interpretations. However, shareholders should take a deeper look if several insiders are selling stock over a specific time period.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.

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The Last 12 Months Of Insider Transactions At Bergman & Beving

The Division Head of Industrial Equipment Division, Oscar Fredell, made the biggest insider sale in the last 12 months. That single transaction was for kr14m worth of shares at a price of kr321 each. That means that an insider was selling shares at slightly below the current price (kr328). 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. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. This single sale was 86% of Oscar Fredell's stake.

Over the last year, we can see that insiders have bought 12.59k shares worth kr3.8m. But they sold 53.79k shares for kr17m. Over the last year we saw more insider selling of Bergman & Beving shares, than buying. You can see a visual depiction of insider transactions (by companies and 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!

View our latest analysis for Bergman & Beving

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Insiders At Bergman & Beving Have Sold Stock Recently

The last quarter saw substantial insider selling of Bergman & Beving shares. In total, CFO & Secretary Peter Schön dumped kr3.0m worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.

Insider Ownership Of Bergman & Beving

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Bergman & Beving insiders own 18% of the company, currently worth about kr1.7b based on the recent share price. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Do The Bergman & Beving Insider Transactions Indicate?

An insider hasn't bought Bergman & Beving stock in the last three months, but there was some selling. Despite some insider buying, the longer term picture doesn't make us feel much more positive. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For instance, we've identified 2 warning signs for Bergman & Beving (1 is concerning) you should be aware of.

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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 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.