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We often see insiders buying up shares in companies that perform well over the long term. 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 before you buy or sell First Sponsor Group Limited (SGX:ADN), you may well want to know whether insiders have been buying or selling.
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 in the company. However, such insiders must disclose their trading activities, and not trade on inside information.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But it is perfectly logical to keep tabs on what insiders are doing. 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.'
Check out our latest analysis for First Sponsor Group
First Sponsor Group Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider purchase was by Non-Executive Chairman Han Ho for S$452k worth of shares, at about S$1.29 per share. That implies that an insider found the current price of S$1.30 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. In this case we're pleased to report that the insider purchases were made at close to current prices.
Over the last year, we can see that insiders have bought 1.3m shares worth S$1.7m. While First Sponsor Group insiders bought shares last year, they didn't sell. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, 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.
First Sponsor Group Insiders Bought Stock Recently
It's good to see that First Sponsor Group insiders have made notable investments in the company's shares. In total, insiders bought S$584k worth of shares in that time, and we didn't record any sales whatsoever. That shows some optimism about the company's future.
Insider Ownership of First Sponsor Group
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. I reckon it's a good sign if insiders own a significant number of shares in the company. First Sponsor Group insiders own about S$31m worth of shares. That equates to 3.0% 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.