Cheffelo Insiders Benefitted From Selling Stock At kr28.37

While Cheffelo AB (publ) (STO:CHEF) shareholders have had a good week with the stock up 15%, they shouldn't let their guards down. Even though stock prices were relatively low, insiders elected to sell kr2.1m worth of stock in the last year, which could indicate some expected downturn.

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.

View our latest analysis for Cheffelo

The Last 12 Months Of Insider Transactions At Cheffelo

The Independent Director, Olle Qvarnstrom, made the biggest insider sale in the last 12 months. That single transaction was for kr1.1m worth of shares at a price of kr28.42 each. That means that even when the share price was below the current price of kr35.40, an insider wanted to cash in some shares. 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. However, while insider selling is sometimes discouraging, it's only a weak signal. We note that the biggest single sale was only 4.5% of Olle Qvarnstrom's holding. Notably Olle Qvarnstrom was also the biggest buyer, having purchased kr1.0m worth of shares.

In the last twelve months insiders purchased 47.70k shares for kr1.0m. But they sold 75.57k shares for kr2.1m. All up, insiders sold more shares in Cheffelo 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!

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: Most of them are flying under the radar).

Insiders At Cheffelo Have Bought Stock Recently

We saw some Cheffelo insider buying shares in the last three months. Insiders purchased kr245k worth of shares in that period. It's great to see that insiders are only buying, not selling. But in this case the amount purchased means the recent transaction may not be very meaningful on its own.

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. Insiders own 25% of Cheffelo shares, worth about kr113m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

What Might The Insider Transactions At Cheffelo Tell Us?

The recent insider purchases are heartening. But we can't say the same for the transactions over the last 12 months. Overall, we'd prefer see a more sustained buying from directors, but with a significant insider holding and more recent purchases, Cheffelo insiders are reasonably well aligned, and optimistic for the future. 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. In terms of investment risks, we've identified 2 warning signs with Cheffelo and understanding them should be part of your investment process.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.