Insiders Buying Senzime Might Wish They Invested More, Stock Gains 13%

Senzime AB (publ) (STO:SEZI) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 13%, resulting in a kr104m rise in the company's market capitalisation, translating to a gain of 11% on their initial investment. Put another way, the original kr806.8k acquisition is now worth kr896.4k.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

Check out our latest analysis for Senzime

Senzime Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when Chief Executive Officer Philip Siberg bought kr740k worth of shares at a price of kr7.25 per share. That means that an insider was happy to buy shares at around the current price of kr7.74. Of course they may have changed their mind. But this suggests they are optimistic. While we always like to see insider buying, it's less meaningful if the purchases were made at much lower prices, as the opportunity they saw may have passed. The good news for Senzime share holders is that insiders were buying at near the current price.

While Senzime insiders bought shares during the last year, they didn't sell. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.

Are Senzime Insiders Buying Or Selling?

There was some insider buying at Senzime over the last quarter. Chief Financial Officer Slavoljub Grujicic bought kr67k worth of shares in that time. It's great to see that insiders are only buying, not selling. But the amount invested in the last three months isn't enough for us too put much weight on it, as a single factor.

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. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It appears that Senzime insiders own 20% of the company, worth about kr181m. 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 Senzime Tell Us?

It is good to see the recent insider purchase. We also take confidence from the longer term picture of insider transactions. But on the other hand, the company made a loss during the last year, which makes us a little cautious. Along with the high insider ownership, this analysis suggests that insiders are quite bullish about Senzime. That's what I like to see! 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. Our analysis shows 6 warning signs for Senzime (1 shouldn't be ignored!) and we strongly recommend you look at these before investing.

Of course Senzime may not be the best stock to buy. So you may wish to see this free collection of high quality 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.