Don't Ignore The Fact That This Insider Just Sold Some Shares In Stadio Holdings Limited (JSE:SDO)

Anyone interested in Stadio Holdings Limited (JSE:SDO) should probably be aware that the Non-Executive Director, Christiaan Van Der Merwe, recently divested R4.9m worth of shares in the company, at an average price of R4.43 each. That sale was 13% of their holding, so it does make us raise an eyebrow.

View our latest analysis for Stadio Holdings

The Last 12 Months Of Insider Transactions At Stadio Holdings

In fact, the recent sale by Non-Executive Director Christiaan Van Der Merwe was not their only trade of Stadio Holdings shares this year. They previously purchased R5.0m worth of shares at a price of R3.80 per share. We do like to see buying, but this purchase was made at well below the current price of R4.30. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

Happily, we note that in the last year insiders paid R6.0m for 1.54m shares. But they sold 1.10m shares for R4.9m. Overall, Stadio Holdings insiders were net buyers during the last year. 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).

Does Stadio Holdings Boast High Insider Ownership?

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. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Our data indicates that Stadio Holdings insiders own about R110m worth of shares (which is 3.0% of the company). But they may have an indirect interest through a corporate structure that we haven't picked up on. Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!

So What Does This Data Suggest About Stadio Holdings Insiders?

The insider sales have outweighed the insider buying, at Stadio Holdings, in the last three months. On the other hand, the insider transactions over the last year are encouraging. And insider ownership remains quite considerable. So we're happy to look past recent trading. 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. In terms of investment risks, we've identified 1 warning sign with Stadio Holdings and understanding this should be part of your investment process.

But note: Stadio Holdings 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. 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.