We often see insiders buying up shares in companies that perform well over the long term. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sell Quality & Reliability A.B.E.E (ATH:QUAL), you may well want to know whether insiders have been buying or selling.
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, 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. For example, a Columbia 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'.
Quality & ReliabilityE.E Insider Transactions Over The Last Year
The Executive President of the Board of Directors, Panagiotis Paschalakis, made the biggest insider sale in the last 12 months. That single transaction was for €61k worth of shares at a price of €0.25 each. So what is clear is that an insider saw fit to sell at around the current price of €0.23. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. In this case, the big sale took place at around the current price, so it's not too bad (but it's still not a positive).
In the last twelve months insiders purchased 30000 shares for €6.0k. But they sold 1.6m for €395k. Over the last year we saw more insider selling of Quality & ReliabilityE.E shares, than buying. You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
I will like Quality & ReliabilityE.E better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
Quality & ReliabilityE.E Insiders Are Selling The Stock
The last quarter saw substantial insider selling of Quality & ReliabilityE.E shares. In total, insiders sold €184k worth of shares in that time, and we didn't record any purchases whatsoever. Overall this makes us a bit cautious, but it's not the be all and end all.
Does Quality & ReliabilityE.E Boast High Insider Ownership?
Many investors like to check how much of a company is owned by 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. Insiders own 22% of Quality & ReliabilityE.E shares, worth about €1.4m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
What Might The Insider Transactions At Quality & ReliabilityE.E Tell Us?
Insiders haven't bought Quality & ReliabilityE.E stock in the last three months, but there was some selling. Zooming out, the longer term picture doesn't give us much comfort. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. We'd think twice before buying! I like to dive deeper into how a company has performed in the past. You can access this interactive graph of past earnings, revenue and cash flow for free .
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body.
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