Director of AB Volvo Picks Up 18,750% More Stock

AB Volvo (publ) (STO:VOLV B) shareholders (or potential shareholders) will be happy to see that the Director, Helena Stjernholm, recently bought a whopping kr396m worth of stock, at a price of kr264. That purchase boosted their holding by 18,750%, which makes us wonder if the move was inspired by quietly confident deeply-felt optimism.

See our latest analysis for AB Volvo

The Last 12 Months Of Insider Transactions At AB Volvo

In fact, the recent purchase by Helena Stjernholm was the biggest purchase of AB Volvo shares made by an insider individual in the last twelve months, according to our records. So it's clear an insider wanted to buy, at around the current price, which is kr272. Of course they may have changed their mind. But this suggests they are optimistic. We do always like to see insider buying, but it is worth noting if those purchases were made at well below today's share price, as the discount to value may have narrowed with the rising price. Happily, the AB Volvo insiders decided to buy shares at close to current prices.

Happily, we note that in the last year insiders paid kr711m for 2.73m shares. But they sold 20.50k shares for kr5.5m. In total, AB Volvo insiders bought more than they sold over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

AB Volvo is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.

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. We usually like to see fairly high levels of insider ownership. AB Volvo insiders own about kr25b worth of shares (which is 4.5% of the company). 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 AB Volvo Insider Transactions Indicate?

It's certainly positive to see the recent insider purchase. And an analysis of the transactions over the last year also gives us confidence. Along with the high insider ownership, this analysis suggests that insiders are quite bullish about AB Volvo. That's what I like to see! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Be aware that AB Volvo is showing 2 warning signs in our investment analysis, and 1 of those shouldn't be ignored...

But note: AB Volvo may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.

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.