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We’ve lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sell Sequent Scientific Limited (NSE:SEQUENT), you may well want to know whether insiders have been buying or selling.
What Is Insider Selling?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock on the market. However, such insiders must disclose their trading activities, and not trade on inside information.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Columbia University study found that ‘insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers’.
Check out our latest analysis for Sequent Scientific
The Last 12 Months Of Insider Transactions At Sequent Scientific
Over the last year, we can see that the biggest insider purchase was by Arunkumar Pillai for ₹8.0m worth of shares, at about ₹79.90 per share. That means that even when the share price was higher, an insider wanted to purchase shares. It’s very possible they regret the purchase, but it’s more likely they are bullish about the company. We generally consider it a positive if insiders have been buying on market, even above the current price.
Over the last year, we can see that insiders have bought 175.00k shares worth ₹12m. But they sold 45.00k for ₹3.2m. In the last twelve months there was more buying than selling by Sequent Scientific insiders. Their average price was about ₹67.01. It’s great to see insiders putting their own cash into the company’s stock, albeit at below the recent share price (₹68.95). You can see the insider transactions (by individuals) over the last year depicted in the chart 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 growing companies that insiders are buying.
Sequent Scientific Insiders Are Selling The Stock
The last three months saw some Sequent Scientific insider selling. Padma Pillai divested only ₹3.2m worth of shares in that time. It’s not great to see insider selling, nor the lack of recent buyers. But the volume sold is so low that it really doesn’t bother us.