Bullish Gates Industrial Insiders Loaded Up On US$13.8m Of Stock

Quite a few insiders have dramatically grown their holdings in Gates Industrial Corporation plc (NYSE:GTES) over the past 12 months. An insider's optimism about the company's prospects is a positive sign.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

View our latest analysis for Gates Industrial

The Last 12 Months Of Insider Transactions At Gates Industrial

The Independent Chairman of Board Neil Simpkins made the biggest insider purchase in the last 12 months. That single transaction was for US$12m worth of shares at a price of US$12.20 each. We do like to see buying, but this purchase was made at well below the current price of US$16.81. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

Gates Industrial insiders may have bought shares in the last year, but they didn't sell any. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.

Does Gates Industrial 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. Insiders own 0.9% of Gates Industrial shares, worth about US$40m. 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 Does This Data Suggest About Gates Industrial Insiders?

It doesn't really mean much that no insider has traded Gates Industrial shares in the last quarter. However, our analysis of transactions over the last year is heartening. Overall we don't see anything to make us think Gates Industrial insiders are doubting the company, and they do own shares. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For example - Gates Industrial has 1 warning sign we think you should be aware of.

But note: Gates Industrial 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.

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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.

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