Insider Buyers Lose kr802k As Cinis Fertilizer Sheds kr112m

The recent price decline of 24% in Cinis Fertilizer AB (publ)'s (STO:CINIS) stock may have disappointed insiders who bought kr1.05m worth of shares at an average price of kr20.80 in the past 12 months. Insiders invest with the hopes of seeing their money grow in value over time. However, as a result of recent losses, their initial investment is now only worth kr244.0k, which is not what they expected.

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.

See our latest analysis for Cinis Fertilizer

The Last 12 Months Of Insider Transactions At Cinis Fertilizer

Over the last year, we can see that the biggest insider purchase was by Independent Member of the Board Sten Hedback for kr561k worth of shares, at about kr39.15 per share. That means that even when the share price was higher than kr4.85 (the recent price), an insider wanted to purchase shares. It's very possible they regret the purchase, but it's more likely they are bullish about the company. We always take careful note of the price insiders pay when purchasing shares. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.

Cinis Fertilizer insiders may have bought shares in the last year, but they didn't sell any. The average buy price was around kr20.80. This is nice to see since it implies that insiders might see value around current prices. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

Cinis Fertilizer is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.

Cinis Fertilizer Insiders Bought Stock Recently

There was some insider buying at Cinis Fertilizer over the last quarter. Insiders bought kr485k worth of shares in that time. It's good to see the insider buying, as well as the lack of recent sellers. 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 Of Cinis Fertilizer

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. It's great to see that Cinis Fertilizer insiders own 73% of the company, worth about kr256m. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Does This Data Suggest About Cinis Fertilizer Insiders?

It's certainly positive to see the recent insider purchases. We also take confidence from the longer term picture of insider transactions. But we don't feel the same about the fact the company is making losses. Once you factor in the high insider ownership, it certainly seems like insiders are positive about Cinis Fertilizer. One for the watchlist, at least! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. When we did our research, we found 4 warning signs for Cinis Fertilizer (1 makes us a bit uncomfortable!) that we believe deserve your full attention.

But note: Cinis Fertilizer 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.