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It is not uncommon to see companies perform well in the years after insiders buy shares. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So we’ll take a look at whether insiders have been buying or selling shares in UP Global Sourcing Holdings plc (LON:UPGS).
What Is Insider Selling?
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 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 UP Global Sourcing Holdings
Over the last year, we can see that the biggest insider purchase was by Independent Non-Executive Chairman James McCarthy for UK£100k worth of shares, at about UK£0.33 per share. Even though the purchase was made at a significantly lower price, we still think insider buying is a positive. The insider buying may not tell us much about how insiders feel about the current share price.
Happily, we note that in the last year insiders bought 460.00k shares for a total of UK£163k. Overall, UP Global Sourcing Holdings insiders were net buyers last year. The average buy price was around UK£0.35. Although they bought at below the recent price of UK£0.44 per share, it is good to see that insiders are willing to invest in the company. You can see the insider transactions 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!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
Insiders at UP Global Sourcing Holdings Have Bought Stock Recently
Over the last three months, we’ve seen significant insider buying at UP Global Sourcing Holdings. Specifically, James McCarthy bought UK£53k worth of shares in that time, and we didn’t record any sales whatsoever. This could be interpreted as suggesting a positive outlook.
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. UP Global Sourcing Holdings insiders own 45% of the company, currently worth about UK£16m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
So What Do The UP Global Sourcing Holdings Insider Transactions Indicate?
It is good to see recent insider purchase. We also take confidence from the longer term picture of insider transactions. Along with the high insider ownership, this analysis suggests that insiders are quite bullish about UP Global Sourcing Holdings. That’s what I like to see! Of course, the future is what matters most. So if you are interested in UP Global Sourcing Holdings, you should check out this free report on analyst forecasts for the company.
But note: UP Global Sourcing Holdings may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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.