Should You Take Comfort From Insider Transactions At Keppel Infrastructure Trust (SGX:A7RU)?

We often see insiders buying up shares in companies that perform well over the long term. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So before you buy or sell Keppel Infrastructure Trust (SGX:A7RU), you may well want to know whether insiders have been buying or selling.

Do Insider Transactions Matter?

It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, rules govern insider transactions, and certain disclosures are required.

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. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise'.

View our latest analysis for Keppel Infrastructure Trust

Keppel Infrastructure Trust Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when insider Ban Heng Koh bought S$188k worth of shares at a price of S$0.38 per share. Even though the purchase was made at a significantly lower price than the recent price (S$0.54), we still think insider buying is a positive. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.

In the last twelve months Keppel Infrastructure Trust insiders were buying shares, but not selling. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

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).

Insider Ownership

Many investors like to check how much of a company is owned by 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. From our data, it seems that Keppel Infrastructure Trust insiders own 0.4% of the company, worth about S$11m. We do generally prefer see higher levels of insider ownership.

So What Does This Data Suggest About Keppel Infrastructure Trust Insiders?

The fact that there have been no Keppel Infrastructure Trust insider transactions recently certainly doesn't bother us. However, our analysis of transactions over the last year is heartening. Insiders do have a stake in Keppel Infrastructure Trust and their transactions don't cause us concern. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Keppel Infrastructure Trust. Every company has risks, and we've spotted 2 warning signs for Keppel Infrastructure Trust you should know about.

But note: Keppel Infrastructure Trust 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, but not derivative transactions.

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This article by Simply Wall St is general in nature. 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.
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