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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 CLS Holdings plc (LON:CLI).
What Is Insider Buying?
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.
Insider transactions are not the most important thing when it comes to long-term investing. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year'.
Check out our latest analysis for CLS Holdings
The Last 12 Months Of Insider Transactions At CLS Holdings
In the last twelve months, the biggest single purchase by an insider was when CFO & Director Andrew Michael Kirkman bought UK£111k worth of shares at a price of UK£2.22 per share. So it's clear an insider wanted to buy, at around the current price, which is UK£2.46. Of course they may have changed their mind. But this suggests they are optimistic. While we always like to see insider buying, it's less meaningful if the purchases were made at much lower prices, as the opportunity they saw may have passed. Happily, the CLS Holdings insiders decided to buy shares at close to current prices.
In the last twelve months CLS Holdings insiders were buying shares, but not selling. You can see a visual depiction of insider transactions (by companies and 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!
CLS Holdings is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Insiders at CLS Holdings Have Bought Stock Recently
Over the last quarter, CLS Holdings insiders have spent a meaningful amount on shares. Not only was there no selling that we can see, but they collectively bought UK£387k worth of shares. This makes one think the business has some good points.
Does CLS Holdings Boast High Insider Ownership?
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. Insiders own 6.8% of CLS Holdings shares, worth about UK£68m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.