Favourable Signals For Redcentric: Numerous Insiders Acquired Stock \
When a single insider purchases stock, it is typically not a major deal. However, when multiple insiders purchase stock, like in Redcentric plc's (LON:RCN) instance, it's good news for shareholders.
While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.
See our latest analysis for Redcentric
The Last 12 Months Of Insider Transactions At Redcentric
The Independent Non-Executive Chairman Nicholas Bate made the biggest insider purchase in the last 12 months. That single transaction was for UK£50k worth of shares at a price of UK£1.24 each. That means that an insider was happy to buy shares at around the current price of UK£1.29. That means they have been optimistic about the company in the past, though they may have changed their mind. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. Happily, the Redcentric insiders decided to buy shares at close to current prices.
Happily, we note that in the last year insiders paid UK£99k for 80.24k shares. But insiders sold 41.67k shares worth UK£49k. In total, Redcentric insiders bought more than they sold over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
Redcentric is not the only stock that insiders are buying. 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 Redcentric
For a common shareholder, it is worth checking how many shares are held by company 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. From looking at our data, insiders own UK£816k worth of Redcentric stock, about 0.4% of the company. However, it's possible that insiders might have an indirect interest through a more complex structure. We consider this fairly low insider ownership.
So What Does This Data Suggest About Redcentric Insiders?
The fact that there have been no Redcentric insider transactions recently certainly doesn't bother us. On a brighter note, the transactions over the last year are encouraging. The transactions are fine but it'd be more encouraging if Redcentric insiders bought more shares in the company. 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. Case in point: We've spotted 3 warning signs for Redcentric you should be aware of, and 1 of them makes us a bit uncomfortable.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.
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