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Investors who take an interest in Inchcape plc (LON:INCH) should definitely note that the Independent Chairman of the Board, Jerry Buhlmann, recently paid UK£6.95 per share to buy UK£250k worth of the stock. We reckon that's a good sign, especially since the purchase boosted their holding by 117%.
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The Last 12 Months Of Insider Transactions At Inchcape
In fact, the recent purchase by Jerry Buhlmann was the biggest purchase of Inchcape 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£7.21. 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.
While Inchcape insiders bought shares during the last year, they didn't sell. 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!
Inchcape 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 Inchcape
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. Insiders own 2.0% of Inchcape shares, worth about UK£56m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
So What Do The Inchcape Insider Transactions Indicate?
It's certainly positive to see the recent insider purchases. We also take confidence from the longer term picture of insider transactions. When combined with notable insider ownership, these factors suggest Inchcape 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. In terms of investment risks, we've identified 1 warning sign with Inchcape and understanding it should be part of your investment process.