Yahoo Finance Have Insiders Been Selling Paragon Banking Group PLC (LON:PAG) Shares?
It is not uncommon to see companies perform well in the years after insiders buy shares. 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 before you buy or sell Paragon Banking Group PLC (LON:PAG), you may well want to know whether insiders have been buying or selling.
What Is Insider Buying?
It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, such insiders must disclose their trading activities, and not trade on inside information.
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.'
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See our latest analysis for Paragon Banking Group
The Last 12 Months Of Insider Transactions At Paragon Banking Group
In the last twelve months, the biggest single sale by an insider was when the Independent Non-Executive Director, Hugo Tudor, sold UK£215k worth of shares at a price of UK£4.30 per share. That means that even when the share price was below the current price of UK£4.63, an insider wanted to cash in some shares. We generally consider it a negative if insiders have been selling on market, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. However, while insider selling is sometimes discouraging, it's only a weak signal. We note that the biggest single sale was only 22.2% of Hugo Tudor's holding.
All up, insiders sold more shares in Paragon Banking Group than they bought, over the last year. The chart below shows insider transactions (by individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
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Paragon Banking Group Insiders Are Selling The Stock
There was substantially more insider selling, than buying, of Paragon Banking Group shares over the last three months. In that time, Hugo Tudor dumped UK£215k worth of shares. On the flip side, Independent Non-Executive Director Barbara Ridpath spent UK£9.9k on purchasing shares (as mentioned above). Generally this level of net selling might be considered a bit bearish.
Insider Ownership of Paragon Banking Group
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. Our data indicates that Paragon Banking Group insiders own about UK£6.8m worth of shares (which is 0.6% of the company). Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!
So What Do The Paragon Banking Group Insider Transactions Indicate?
The insider sales have outweighed the insider buying, at Paragon Banking Group, in the last three months. Despite some insider buying, the longer term picture doesn't make us feel much more positive. On the plus side, Paragon Banking Group makes money, and is growing profits. When you combine this with the relatively low insider ownership, we are very cautious about the stock. So we're not rushing to buy, to say the least. Of course, the future is what matters most. So if you are interested in Paragon Banking Group, you should check out this free report on analyst forecasts for the company.
Of course Paragon Banking Group may not be the best stock to buy. So you may wish to see this free collection of high quality companies.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
