Yahoo Finance Insiders who bought in the last 12 months lose an additional UK£5.2k as United Utilities Group PLC (LON:UU.) drops to UK£578b
The recent 5.8% drop in United Utilities Group PLC's (LON:UU.) stock could come as a blow to insiders who purchased UK£120k worth of stock at an average buy price of UK£8.85 over the past 12 months. Insiders invest with the hopes of seeing their money grow in value over time. However, as a result of recent losses, their initial investment is now only worth UK£115k, which is not what they expected.
Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.
See our latest analysis for United Utilities Group
United Utilities Group Insider Transactions Over The Last Year
The General Counsel & Company Secretary Simon Gardiner made the biggest insider purchase in the last 12 months. That single transaction was for UK£54k worth of shares at a price of UK£8.92 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being UK£8.47). 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. To us, it's very important to consider the price insiders pay for shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.
United Utilities Group insiders may have bought shares in the last year, but they didn't sell any. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).
Insiders At United Utilities Group Have Bought Stock Recently
It's good to see that United Utilities Group insiders have made notable investments in the company's shares. Not only was there no selling that we can see, but they collectively bought UK£120k worth of shares. This could be interpreted as suggesting a positive outlook.
Does United Utilities Group Boast High Insider Ownership?
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. United Utilities Group insiders own about UK£307m worth of shares (which is 0.05% of the company). 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 United Utilities Group Insiders?
The recent insider purchases are heartening. We also take confidence from the longer term picture of insider transactions. But we don't feel the same about the fact the company is making losses. Once you factor in the high insider ownership, it certainly seems like insiders are positive about United Utilities Group. Looks promising! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Case in point: We've spotted 2 warning signs for United Utilities Group you should be aware of.
But note: United Utilities Group may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.
For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions, but not derivative transactions.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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