Want to participate in a short research study? Help shape the future of investing tools and receive a $20 prize!

We often see insiders buying up shares in companies that perform well over the long term. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So shareholders might well want to know whether insiders have been buying or selling shares in Menon Bearings Limited (NSE:MENONBE).

Do Insider Transactions Matter?

It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. 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 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.’

See our latest analysis for Menon Bearings

Menon Bearings Insider Transactions Over The Last Year

While there weren’t any large insider transactions in the last twelve months, it’s still worth looking at the trading.

Over the last year, we can see that insiders have bought 107.60k shares worth ₹9.9m. Overall, Menon Bearings insiders were net buyers last year. The average buy price was around ₹92.03. This is nice to see since it implies that insiders might see value around current prices (around ₹75.55). 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!

I will like Menon Bearings better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

Insider Ownership

Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. It’s great to see that Menon Bearings insiders own 49% of the company, worth about ₹2.1b. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Does This Data Suggest About Menon Bearings Insiders?

It doesn’t really mean much that no insider has traded Menon Bearings shares in the last quarter. But insiders have shown more of an appetite for the stock, over the last year. It would be great to see more insider buying, but overall it seems like Menon Bearings insiders are reasonably well aligned (owning significant chunk of the company’s shares) and optimistic for the future. Along with insider transactions, I recommend checking if Menon Bearings is growing revenue. This free chart of historic revenue and earnings should make that easy.