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Even if it's not a huge purchase, we think it was good to see that John Chan, the Executive Chairman of Finbar Group Limited (ASX:FRI) recently shelled out AU$96k to buy stock, at AU$0.96 per share. Although the purchase is not a big one, by either a percentage standpoint or absolute value, it can be seen as a good sign.
See our latest analysis for Finbar Group
The Last 12 Months Of Insider Transactions At Finbar Group
The insider, Calogero Rubino, made the biggest insider sale in the last 12 months. That single transaction was for AU$4.1m worth of shares at a price of AU$0.83 each. That means that an insider was selling shares at slightly below the current price (AU$0.98). As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. It is worth noting that this sale was only 32% of Calogero Rubino's holding. Calogero Rubino was the only individual insider to sell shares in the last twelve months.
Over the last year, we can see that insiders have bought 211.07k shares worth AU$170k. But they sold 9.00m shares for AU$7.2m. Calogero Rubino divested 9.00m shares over the last 12 months at an average price of AU$0.80. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
If you are like me, then you will not want to miss this free list of small cap stocks that are not only being bought by insiders but also have attractive valuations.
Insider Ownership
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. It appears that Finbar Group insiders own 23% of the company, worth about AU$60m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
So What Does This Data Suggest About Finbar Group Insiders?
The stark truth for Finbar Group is that there has been more insider selling than insider buying in the last three months. Zooming out, the longer term picture doesn't give us much comfort. On the plus side, Finbar Group makes money, and is growing profits. While insiders do own shares, they don't own a heap, and they have been selling. We'd practice some caution before buying! 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. Be aware that Finbar Group is showing 4 warning signs in our investment analysis, and 3 of those are concerning...