Stock Analysis

As BICO Group AB (publ)'s market cap (STO:BICO) drops to kr4.1b, insiders might be questioning their decision to buy earlier this year

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The recent price decline of 16% in BICO Group AB (publ)'s (STO:BICO) stock may have disappointed insiders who bought kr13m worth of shares at an average price of kr65.91 in the past 12 months. Insiders purchase with the hope of seeing their investments increase in value over time. However, due to recent losses, their initial investment is now only worth kr12m, which is not great.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

View our latest analysis for BICO Group

The Last 12 Months Of Insider Transactions At BICO Group

The Independent Chairman of the Board, Carsten Browall, made the biggest insider sale in the last 12 months. That single transaction was for kr8.4m worth of shares at a price of kr104 each. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. It's of some comfort that this sale was conducted at a price well above the current share price, which is kr58.30. So it may not shed much light on insider confidence at current levels. The only individual insider seller over the last year was Carsten Browall.

Happily, we note that in the last year insiders paid kr13m for 203.46k shares. But they sold 80.00k shares for kr8.4m. In the last twelve months there was more buying than selling by BICO Group insiders. Their average price was about kr65.91. These transactions suggest that insiders have considered the current price attractive. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

OM:BICO Insider Trading Volume March 15th 2023

There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).

BICO Group Insiders Are Selling The Stock

Over the last three months, we've seen notably more insider selling, than insider buying, at BICO Group. We note Independent Chairman of the Board Carsten Browall cashed in kr8.4m worth of shares. On the flip side, Independent Director Helena Skantorp spent kr100k on purchasing shares. The share price has moved a bit recently, but it's hard to argue that the selling is a positive.

Insider Ownership Of BICO Group

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. It's great to see that BICO Group insiders own 28% of the company, worth about kr1.2b. 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 BICO Group Insiders?

The stark truth for BICO Group is that there has been more insider selling than insider buying in the last three months. In contrast, they appear keener if you look at the last twelve months. We are also comforted by the high levels of insider ownership. So we're not too bothered by recent selling. 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 5 warning signs we've spotted with BICO Group (including 2 which are a bit concerning).

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, but not derivative transactions.

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