nib holdings limited (ASX:NHF) Insiders Have Been Selling
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We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. 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 shareholders might well want to know whether insiders have been buying or selling shares in nib holdings limited (ASX:NHF).
Do Insider Transactions Matter?
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 it is perfectly logical to keep tabs on what insiders are doing. 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'.
Check out our latest analysis for nib holdings
The Last 12 Months Of Insider Transactions At nib holdings
Over the last year, we can see that the biggest insider purchase was by MD, CEO & Executive Director Mark Fitzgibbon for AU$591k worth of shares, at about AU$6.45 per share. That implies that an insider found the current price of AU$7.95 per share to be enticing. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. We do always like to see insider buying, but it is worth noting if those purchases were made at well below today's share price, as the discount to value may have narrowed with the rising price. The good news for nib holdings share holders is that insiders were buying at near the current price. Notably Mark Fitzgibbon was also the biggest seller, having sold AU$914k worth of shares.
Happily, we note that in the last year insiders paid AU$859k for 138k shares. On the other hand they divested 140k shares, for AU$914k. Mark Fitzgibbon sold a total of 140k shares over the year at an average price of AU$6.53. 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!
For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Insiders at nib holdings Have Sold Stock Recently
There was substantially more insider selling, than buying, of nib holdings shares over the last three months. In total, Mark Fitzgibbon sold AU$533k worth of shares in that time. On the other hand we note Independent Non-Executive Director Jacqueline Chow bought AU$269k worth of shares. Generally this level of net selling might be considered a bit bearish.
Insider Ownership
Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. nib holdings insiders own about AU$41m worth of shares. That equates to 1.1% of the company. 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 nib holdings Tell Us?
Unfortunately, there has been more insider selling of nib holdings stock, than buying, in the last three months. And our longer term analysis of insider transactions didn't bring confidence, either. But since nib holdings is profitable and growing, we're not too worried by this. While insiders do own shares, they don't own a heap, and they have been selling. So we'd only buy after careful consideration. 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.
But note: nib 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.
For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.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.
