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We often see insiders buying up shares in companies that perform well over the long term. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So shareholders might well want to know whether insiders have been buying or selling shares in Gates Industrial Corporation plc (NYSE:GTES).
What Is Insider Selling?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, most countries require that the company discloses such transactions to the market.
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.’
The Last 12 Months Of Insider Transactions At Gates Industrial
In the last twelve months, the biggest single purchase by an insider was when CEO & Director Ivo Jurek bought US$154k worth of shares at a price of US$15.36 per share. That means that even when the share price was higher, an insider wanted to purchase shares. Their view may have changed since then, but at least it shows they felt optimistic at the time. That purchase may suggest an expectation of positive returns over the long term.
In the last twelve months insiders paid US$406k for 26.95k shares purchased. Overall, Gates Industrial insiders were net buyers last year. The average buy price was around US$15.07. This is nice to see since it implies that insiders might see value around current prices (around US$15.03). You can see the insider transactions (by 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!
I will like Gates Industrial better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
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. From our data, it seems that Gates Industrial insiders own 0.1% of the company, worth about US$5.5m. Whilst better than nothing, we’re not overly impressed by these holdings.
So What Does This Data Suggest About Gates Industrial Insiders?
There haven’t been any insider transactions in the last three months — that doesn’t mean much. On a brighter note, the transactions over the last year are encouraging. The transactions are fine but it’d be more encouraging if Gates Industrial insiders bought more shares in the company. Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for Gates Industrial.
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.
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.