Possible Bearish Signals With Genpact Insiders Disposing Stock

In the last year, many Genpact Limited (NYSE:G) insiders sold a substantial stake in the company which may have sparked shareholders' attention. When analyzing insider transactions, it is usually more valuable to know whether insiders are buying versus knowing if they are selling, as the latter sends an ambiguous message. However, if numerous insiders are selling, shareholders should investigate more.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.

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The Last 12 Months Of Insider Transactions At Genpact

Over the last year, we can see that the biggest insider sale was by the Director, Nallicheri Tyagarajan, for US$6.0m worth of shares, at about US$54.87 per share. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The good news is that this large sale was at well above current price of US$43.52. So it is hard to draw any strong conclusion from it.

All up, insiders sold more shares in Genpact than they bought, over 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!

Check out our latest analysis for Genpact

I will like Genpact 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.

Insiders At Genpact Have Bought Stock Recently

Over the last three months, we've seen significant insider buying at Genpact. Independent Director Nicholas Gangestad spent US$88k on stock, and there wasn't any selling. This could be interpreted as suggesting a positive outlook.

Does Genpact Boast High 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. Genpact insiders own about US$62m worth of shares. That equates to 0.8% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

What Might The Insider Transactions At Genpact Tell Us?

The recent insider purchase is heartening. But we can't say the same for the transactions over the last 12 months. The more recent transactions are a positive, but Genpact insiders haven't shown the sustained enthusiasm that we look for, although they do own a decent number of shares, overall. Overall they seem reasonably aligned. Of course, the future is what matters most. So if you are interested in Genpact, you should check out this free report on analyst forecasts for the company.

But note: Genpact 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.