Bure Equity Insiders Sell kr42m Of Stock, Possibly Signalling Caution

Many Bure Equity AB (publ) (STO:BURE) insiders ditched their stock over the past year, which may be of interest to the company's shareholders. When analyzing insider transactions, it is usually more valuable to know whether insiders are buying versus knowing if they are selling, as the latter sends an ambiguous message. However, shareholders should take a deeper look if several insiders are selling stock over a specific time period.

While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.

See our latest analysis for Bure Equity

Bure Equity Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the Director, Carl Bjorkman, sold kr39m worth of shares at a price of kr395 per share. That means that an insider was selling shares at below the current price (kr395). As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower 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. We note that the biggest single sale was only 3.3% of Carl Bjorkman's holding. Notably Carl Bjorkman was also the biggest buyer, having purchased kr22m worth of shares.

Happily, we note that in the last year insiders paid kr22m for 54.84k shares. On the other hand they divested 105.00k shares, for kr42m. In total, Bure Equity insiders sold more than they bought over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

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Bure Equity Insiders Are Selling The Stock

Over the last three months, we've seen notably more insider selling, than insider buying, at Bure Equity. We note Director Carl Bjorkman cashed in kr39m worth of shares. On the flip side, insiders spent kr21m on purchasing shares. Because the selling vastly outweighs the buying, we'd say this is a somewhat bearish sign.

Insider Ownership

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. Bure Equity insiders own about kr7.2b worth of shares (which is 25% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Do The Bure Equity Insider Transactions Indicate?

The stark truth for Bure Equity is that there has been more insider selling than insider buying in the last three months. Zooming out, the longer term picture doesn't give us much comfort. On the plus side, Bure Equity makes money, and is growing profits. 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. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Bure Equity. Be aware that Bure Equity is showing 2 warning signs in our investment analysis, and 1 of those shouldn't be ignored...

But note: Bure Equity 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.