Insiders Who Sold kr5.5m Of Smart Eye Made The Right Call

While Smart Eye AB (publ) (STO:SEYE) shareholders have had a good week with the stock up 15%, they shouldn't let their guards down. Although prices were relatively low, insiders chose to sell kr5.5m worth of stock in the past 12 months. This could be a sign of impending weakness.

Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.

AI is about to change healthcare. These 20 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10bn in marketcap - there is still time to get in early.

Smart Eye Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the Founder, Martin Krantz, for kr3.1m worth of shares, at about kr57.74 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of kr69.85. 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. 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. It is worth noting that this sale was only 5.0% of Martin Krantz's holding. Martin Krantz was the only individual insider to sell shares in the last twelve months.

Martin Krantz divested 94.05k shares over the last 12 months at an average price of kr58.61. 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!

Check out our latest analysis for Smart Eye

I will like Smart Eye 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.

Does Smart Eye Boast High Insider Ownership?

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Smart Eye insiders own about kr396m worth of shares. That equates to 15% of the company. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

What Might The Insider Transactions At Smart Eye Tell Us?

There haven't been any insider transactions in the last three months -- that doesn't mean much. It's great to see high levels of insider ownership, but looking back over the last year, we don't gain confidence from the Smart Eye insiders selling. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. For example - Smart Eye has 1 warning sign we think you should be aware of.

But note: Smart Eye 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.

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.