We’ve lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So shareholders might well want to know whether insiders have been buying or selling shares in Fisher & Paykel Healthcare Corporation Limited (NZSE:FPH).
What Is Insider Selling?
It’s quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, rules govern insider transactions, and certain disclosures are required.
We don’t think shareholders should simply follow insider transactions. But it is perfectly logical to keep tabs on what insiders are doing. For example, a Colombia University study found that ‘insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers’.
The Last 12 Months Of Insider Transactions At Fisher & Paykel Healthcare
Non-Executive Director Michael Daniell made the biggest insider purchase in the last 12 months. That single transaction was for NZ$1.5m worth of shares at a price of NZ$14.89 each. So it’s clear an insider wanted to buy, even at a higher price. Their view may have changed since then, but at least it shows they felt optimistic at the time. We generally consider it a positive if insiders have been buying on market, even above the current price. Notably Michael Daniell was also the biggest seller, having sold NZ$1.9m worth of shares.
Happily, we note that in the last year insiders paid NZ$2.0m for 137.16k shares. But they sold 128.00k for NZ$1.9m. In the last twelve months there was more buying than selling by Fisher & Paykel Healthcare insiders. They paid about NZ$14.68 on average. This is nice to see since it implies that insiders might see value around current prices (around NZ$12.25). You can see the insider transactions 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!
I will like Fisher & Paykel Healthcare better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
Insiders at Fisher & Paykel Healthcare Have Sold Stock Recently
The last three months saw some Fisher & Paykel Healthcare insider selling. NZ$272k worth of shares were sold by MD, CEO & Executive Director Lewis Gradon. But at least we saw NZ$241k worth of buying. While it’s not great to see insider selling, the net amount sold isn’t enough for us to want to read anything into it.
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. I reckon it’s a good sign if insiders own a significant number of shares in the company. It’s great to see that Fisher & Paykel Healthcare insiders own 0.4% of the company, worth about NZ$28m. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
What Might The Insider Transactions At Fisher & Paykel Healthcare Tell Us?
We note a that there’s been a little more insider selling than buying, recently. But the difference is small, and thus, not concerning. On a brighter note, the transactions over the last year are encouraging. Overall we don’t see anything to make us think Fisher & Paykel Healthcare insiders are doubting the company, and they do own shares. Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for Fisher & Paykel Healthcare.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at firstname.lastname@example.org.