Should You Take Comfort From Insider Transactions At Vukile Property Fund Limited (JSE:VKE)?

By
Simply Wall St
Published
May 24, 2021
JSE:VKE
Source: Shutterstock

We often see insiders buying up shares in companies that perform well over the long term. On the other hand, we'd be remiss not to mention that insider sales have been known to precede tough periods for a business. So shareholders might well want to know whether insiders have been buying or selling shares in Vukile Property Fund Limited (JSE:VKE).

What Is Insider Buying?

It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, most countries require that the company discloses such transactions to the market.

We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year'.

Check out our latest analysis for Vukile Property Fund

The Last 12 Months Of Insider Transactions At Vukile Property Fund

In the last twelve months, the biggest single purchase by an insider was when CEO & Executive Director Laurence Rapp bought R3.1m worth of shares at a price of R7.20 per share. We do like to see buying, but this purchase was made at well below the current price of R9.37. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

Over the last year, we can see that insiders have bought 549.41k shares worth R4.0m. But they sold 135.60k shares for R1.1m. In the last twelve months there was more buying than selling by Vukile Property Fund insiders. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

insider-trading-volume
JSE:VKE Insider Trading Volume May 25th 2021

Vukile Property Fund is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Insider Ownership of Vukile Property Fund

Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 3.4% of Vukile Property Fund shares, worth about R303m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Do The Vukile Property Fund Insider Transactions Indicate?

The fact that there have been no Vukile Property Fund insider transactions recently certainly doesn't bother us. On a brighter note, the transactions over the last year are encouraging. With high insider ownership and encouraging transactions, it seems like Vukile Property Fund insiders think the business has merit. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Vukile Property Fund. At Simply Wall St, we found 2 warning signs for Vukile Property Fund that deserve your attention before buying any shares.

Of course Vukile Property Fund may not be the best stock to buy. So you may wish to see this free collection of high quality 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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