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 Banco de Sabadell, S.A. (BME:SAB).
What Is Insider Selling?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, rules govern insider transactions, and certain disclosures are required.
We don’t think shareholders should simply follow insider transactions. But equally, we would consider it foolish to ignore insider transactions altogether. 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.’
Banco de Sabadell Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when David Martínez Guzmán bought €246m worth of shares at a price of €1.36 per share. So it’s clear an insider wanted to buy, even at a higher price. It’s very possible they regret the purchase, but it’s more likely they are bullish about the company. It’s not at all bad to see insiders buy shares at or above current prices.
In the last twelve months insiders paid €512m for 383.70m shares purchased. In total, Banco de Sabadell insiders bought more than they sold over the last year. They paid about €1.33 on average. This is nice to see since it implies that insiders might see value around current prices (around €1.00). 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!
If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).
Insiders at Banco de Sabadell Have Bought Stock Recently
It’s good to see that Banco de Sabadell insiders have made notable investments in the company’s shares. Not only was there no selling that we can see, but they collectively bought €20m worth of shares. That shows some optimism about the company’s future.
Does Banco de Sabadell Boast High Insider Ownership?
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. It appears that Banco de Sabadell insiders own 0.2% of the company, worth about €9.7m. We’ve certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
So What Does This Data Suggest About Banco de Sabadell Insiders?
It’s certainly positive to see the recent insider purchases. We also take confidence from the longer term picture of insider transactions. While the overall levels of insider ownership are below what we’d like to see, the history of transactions imply that Banco de Sabadell insiders are reasonably well aligned, and optimistic for the future. If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.
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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If you spot an error that warrants correction, please contact the editor at email@example.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.