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Usually, when one insider buys stock, it might not be a monumental event. But when multiple insiders are buying like they did in the case of Cavendish Financial plc (LON:CAV), that sends out a positive message to the company's shareholders.
Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.
Check out our latest analysis for Cavendish Financial
Cavendish Financial Insider Transactions Over The Last Year
The Co-CEO & Director Julian Morse made the biggest insider purchase in the last 12 months. That single transaction was for UK£80k worth of shares at a price of UK£0.089 each. We do like to see buying, but this purchase was made at well below the current price of UK£0.14. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.
Cavendish Financial 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. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Cavendish Financial is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.
Insider Ownership Of Cavendish Financial
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that Cavendish Financial insiders own 36% of the company, worth about UK£19m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
So What Does This Data Suggest About Cavendish Financial Insiders?
There haven't been any insider transactions in the last three months -- that doesn't mean much. But insiders have shown more of an appetite for the stock, over the last year. Insiders do have a stake in Cavendish Financial and their transactions don't cause us concern. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. To help with this, we've discovered 4 warning signs (3 shouldn't be ignored!) that you ought to be aware of before buying any shares in Cavendish Financial.