Despite Recent Gains, Frencken Group Insiders Are Still Down S$16k

Insiders who purchased S$82.5k worth of Frencken Group Limited (SGX:E28) shares over the past year recouped some of their losses after price gained 17% last week. However, the purchase is proving to be a costly gamble, since losses made by insiders have totalled S$16k since the time of purchase.

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.

See our latest analysis for Frencken Group

Frencken Group Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider purchase was by Independent Non-Executive Director Noorashidah Binti Ahmad for S$83k worth of shares, at about S$1.65 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being S$1.34). It's very possible they regret the purchase, but it's more likely they are bullish about the company. In our view, the price an insider pays for shares is very important. As a general rule, we feel more positive about a stock when an insider has bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price. Noorashidah Binti Ahmad was the only individual insider to buy during the last year.

You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

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

Insider Ownership Of Frencken 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. I reckon it's a good sign if insiders own a significant number of shares in the company. Frencken Group insiders own about S$52m worth of shares. That equates to 9.0% of the company. 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 Frencken Group Insider Transactions Indicate?

It doesn't really mean much that no insider has traded Frencken Group shares in the last quarter. But insiders have shown more of an appetite for the stock, over the last year. Insiders do have a stake in Frencken Group and their transactions don't cause us concern. 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 - Frencken Group has 1 warning sign we think you should be aware of.

Of course Frencken Group 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.