Possible Bearish Signals With Ambea Insiders Disposing Stock

Many Ambea AB (publ) (STO:AMBEA) 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, if numerous insiders are selling, shareholders should investigate more.

While insider transactions are not the most important thing when it comes to long-term investing, 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

Over the last year, we can see that the biggest insider sale was by the CEO & President, Mark Jensen, for kr5.3m worth of shares, at about kr97.00 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of kr107. We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. We note that the biggest single sale was only 28% of Mark Jensen's holding. Notably Mark Jensen was also the biggest buyer, having purchased kr2.7m worth of shares.

Happily, we note that in the last year insiders paid kr2.7m for 25.65k shares. But they sold 90.50k shares for kr8.8m. Over the last year we saw more insider selling of Ambea 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 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.

Insiders At Ambea Have Bought Stock Recently

Over the last three months, we've seen significant insider buying at Ambea. Not only was there no selling that we can see, but they collectively bought kr2.4m worth of shares. This makes one think the business has some good points.

Does Ambea Boast High Insider Ownership?

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. From our data, it seems that Ambea insiders own 1.1% of the company, worth about kr86m. However, it's possible that insiders might have an indirect interest through a more complex structure. Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!

So What Does This Data Suggest About Ambea Insiders?

The recent insider purchases are heartening. On the other hand the transaction history, over the last year, isn't so positive. While recent transactions indicate confidence in Ambea, insiders don't own enough of the company to overcome our cautiousness about the longer term transactions. So they seem pretty well aligned, overall. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. To that end, you should learn about the 2 warning signs we've spotted with Ambea (including 1 which is potentially serious).

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.