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Trade Alert: The Independent Non-Executive Director Of British American Tobacco p.l.c. (LON:BATS), Luc Jobin, Has Just Spent UK£1.2m Buying 99% More Shares

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Those following along with British American Tobacco p.l.c. (LON:BATS) will no doubt be intrigued by the recent purchase of shares by Luc Jobin, Independent Non-Executive Director of the company, who spent a stonking UK£1.2m on stock at an average price of UK£25.98. That purchase boosted their holding by 99%, which makes us wonder if the move was inspired by quietly confident deeply-felt optimism.

See our latest analysis for British American Tobacco

The Last 12 Months Of Insider Transactions At British American Tobacco

In fact, the recent purchase by Luc Jobin was the biggest purchase of British American Tobacco shares made by an insider individual in the last twelve months, according to our records. That means that an insider was happy to buy shares at around the current price of UK£26.06. 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. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. In this case we're pleased to report that the insider purchases were made at close to current prices.

British American Tobacco insiders may have bought shares in the last year, but they didn't sell any. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

insider-trading-volume
insider-trading-volume

British American Tobacco is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Insider Ownership

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with 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. British American Tobacco insiders own about UK£99m worth of shares (which is 0.2% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Do The British American Tobacco Insider Transactions Indicate?

The recent insider purchase is heartening. And an analysis of the transactions over the last year also gives us confidence. When combined with notable insider ownership, these factors suggest British American Tobacco insiders are well aligned, and that they may think the share price is too low. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Case in point: We've spotted 2 warning signs for British American Tobacco you should be aware of.

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.

For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions, but not derivative transactions.

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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.