How Much Are Raffles Medical Group Ltd (SGX:BSL) Insiders Spending On Buying Shares?

We often see insiders buying up shares in companies that perform well over the long term. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So shareholders might well want to know whether insiders have been buying or selling shares in Raffles Medical Group Ltd (SGX:BSL).

What Is Insider Selling?

It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, such insiders must disclose their trading activities, and not trade on inside information.

We don't think shareholders should simply follow insider transactions. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Columbia University study found that 'insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers'.

See our latest analysis for Raffles Medical Group

The Last 12 Months Of Insider Transactions At Raffles Medical Group

The Executive Chairman & CEO Choon Yong Loo made the biggest insider purchase in the last 12 months. That single transaction was for S$866k worth of shares at a price of S$0.83 each. So it's clear an insider wanted to buy, at around the current price, which is S$0.83. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. While we always like to see insider buying, it's less meaningful if the purchases were made at much lower prices, as the opportunity they saw may have passed. The good news for Raffles Medical Group share holders is that insiders were buying at near the current price.

Over the last year, we can see that insiders have bought 5.61m shares worth S$4.5m. But they sold 10.00k shares for S$8.0k. In the last twelve months there was more buying than selling by Raffles Medical Group insiders. 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!

Raffles Medical Group is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Are Raffles Medical Group Insiders Buying Or Selling?

We have seen a bit of insider selling at Raffles Medical Group, over the last three months. Non-Executive & Independent Director Teik Lim Ang only netted S$8.0k selling shares, in that period. It's not great to see insider selling, nor the lack of recent buyers. But the volume sold is so low that it really doesn't bother us.

Does Raffles Medical Group Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Raffles Medical Group insiders own about S$193m worth of shares (which is 12% of the company). 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 Do The Raffles Medical Group Insider Transactions Indicate?

We did not see any insider buying in the last three months, but we did see selling. But given the selling was modest, we're not worried. However, our analysis of transactions over the last year is heartening. Judging from their transactions, and high insider ownership, Raffles Medical Group insiders feel good about the company's future. While we like knowing 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. While conducting our analysis, we found that Raffles Medical Group has 1 warning sign and it would be unwise to ignore this.

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, but not derivative transactions.

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