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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. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So shareholders might well want to know whether insiders have been buying or selling shares in Spirax-Sarco Engineering plc (LON:SPX).

Do Insider Transactions Matter?

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, rules govern insider transactions, and certain disclosures are required.

We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year.'

View our latest analysis for Spirax-Sarco Engineering

The Last 12 Months Of Insider Transactions At Spirax-Sarco Engineering

Over the last year, we can see that the biggest insider purchase was by Chairman of the Board James Robert Pike for UK£200k worth of shares, at about UK£70.02 per share. That implies that an insider found the current price of UK£87.00 per share to be enticing. Of course they may have changed their mind. But this suggests they are optimistic. 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. The good news for Spirax-Sarco Engineering share holders is that insiders were buying at near the current price.

In the last twelve months insiders paid UK£259k for 3756 shares purchased. In the last twelve months Spirax-Sarco Engineering insiders were buying shares, but not selling. The chart below shows insider transactions (by individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

Spirax-Sarco Engineering is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Insider Ownership of Spirax-Sarco Engineering

For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 0.2% of Spirax-Sarco Engineering shares, worth about UK£10m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.