It is not uncommon to see companies perform well in the years after insiders buy shares. 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 we'll take a look at whether insiders have been buying or selling shares in Beghelli S.p.A. (BIT:BE).
Do Insider Transactions Matter?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock on the market. However, such insiders must disclose their trading activities, and not trade on inside information.
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. 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.'
The Last 12 Months Of Insider Transactions At Beghelli
The Chairman of the Board of Directors & CEO, Gian Beghelli, made the biggest insider sale in the last 12 months. That single transaction was for €8.0m worth of shares at a price of €0.35 each. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. The good news is that this large sale was at well above current price of €0.26. So it may not tell us anything about how insiders feel about the current share price. Gian Beghelli was the only individual insider to sell shares in the last twelve months. Notably Gian Beghelli was also the biggest buyer, having purchased €253k worth of shares.
You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Insider Ownership of Beghelli
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. We usually like to see fairly high levels of insider ownership. It's great to see that Beghelli insiders own 49% of the company, worth about €25m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
What Might The Insider Transactions At Beghelli Tell Us?
The fact that there have been no Beghelli insider transactions recently certainly doesn't bother us. While we feel good about high insider ownership of Beghelli, we can't say the same about the selling of shares. Along with insider transactions, I recommend checking if Beghelli is growing revenue. This free chart of historic revenue and earnings should make that easy.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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