Ambea Insiders Sold kr13m Of Shares Suggesting Hesitancy

The fact that multiple Ambea AB (publ) (STO:AMBEA) insiders offloaded a considerable amount of shares over the past year could have raised some eyebrows amongst investors. 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, when multiple insiders sell stock over a specific duration, shareholders should take notice as that could possibly be a red flag.

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.

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The Last 12 Months Of Insider Transactions At Ambea

The Chief Operational Excellence Officer & MD of Altiden, Ulla Tansen, made the biggest insider sale in the last 12 months. That single transaction was for kr11m worth of shares at a price of kr112 each. That means that an insider was selling shares at slightly below the current price (kr124). 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. However, while insider selling is sometimes discouraging, it's only a weak signal. We note that the biggest single sale was only 33% of Ulla Tansen's holding.

In the last twelve months insiders purchased 43.15k shares for kr4.8m. But insiders sold 118.67k shares worth kr13m. In total, Ambea insiders sold more than they bought over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

Check out our latest analysis for Ambea

I will like Ambea better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Ambea Insiders Bought Stock Recently

Over the last quarter, Ambea insiders have spent a meaningful amount on shares. Overall, two insiders shelled out kr953k for shares in the company -- and none sold. This is a positive in our book as it implies some confidence.

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Our data indicates that Ambea insiders own about kr89m worth of shares (which is 0.9% of the company). But they may have an indirect interest through a corporate structure that we haven't picked up on. We do generally prefer see higher levels of insider ownership.

So What Do The Ambea Insider Transactions Indicate?

It is good to see recent purchasing. But we can't say the same for the transactions over the last 12 months. The more recent transactions are a positive, but Ambea insiders haven't shown the sustained enthusiasm that we look for, although they do own a decent number of shares, overall. So they seem pretty well aligned, overall. 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 Ambea you should be aware of, and 1 of them is potentially serious.

But note: Ambea 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.