Possible Bearish Signals With Dynavox Group Insiders Disposing Stock

The fact that multiple Dynavox Group AB (publ) (STO:DYVOX) insiders offloaded a considerable amount of shares over the past year could have raised some eyebrows amongst investors. When evaluating insider transactions, knowing whether insiders are buying is usually more beneficial than knowing whether they are selling, as the latter can be open to many interpretations. However, if numerous insiders are selling, shareholders should investigate more.

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.

Check out our latest analysis for Dynavox Group

Dynavox Group Insider Transactions Over The Last Year

The Director, Henrik Eskilsson, made the biggest insider sale in the last 12 months. That single transaction was for kr24m worth of shares at a price of kr52.86 each. That means that an insider was selling shares at slightly below the current price (kr56.40). When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. It is worth noting that this sale was only 10% of Henrik Eskilsson's holding.

Over the last year, we can see that insiders have bought 97.02k shares worth kr4.2m. On the other hand they divested 472.09k shares, for kr25m. All up, insiders sold more shares in Dynavox Group than they bought, over the last year. The sellers received a price of around kr52.33, on average. It's not particularly great to see insiders were selling shares at below recent prices. Of course, the sales could be motivated for a multitude of reasons, so we shouldn't jump to conclusions. 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!

I will like Dynavox Group 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 Dynavox Group Have Bought Stock Recently

It's good to see that Dynavox Group insiders have made notable investments in the company's shares. Not only was there no selling that we can see, but they collectively bought kr1.6m worth of shares. That shows some optimism about the company's future.

Does Dynavox Group 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. 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 Dynavox Group insiders own 4.4% of the company, worth about kr262m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Do The Dynavox Group Insider Transactions Indicate?

It is good to see recent purchasing. On the other hand the transaction history, over the last year, isn't so positive. The recent buying by some insiders , along with high insider ownership, suggest that Dynavox Group insiders are fairly aligned, and optimistic. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Dynavox Group. Every company has risks, and we've spotted 1 warning sign for Dynavox Group you should know about.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com