Yahoo Finance Need To Know: Nanoco Group plc (LON:NANO) Insiders Have Been Buying Shares
We often see insiders buying up shares in companies that perform well over the long term. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So we'll take a look at whether insiders have been buying or selling shares in Nanoco Group plc (LON:NANO).
Do Insider Transactions Matter?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. 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 Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year.
View our latest analysis for Nanoco Group
The Last 12 Months Of Insider Transactions At Nanoco Group
Over the last year, we can see that the biggest insider sale was by the insider, Richard Griffiths, for UK£596k worth of shares, at about UK£0.14 per share. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. The silver lining is that this sell-down took place above the latest price (UK£0.10). So it may not tell us anything about how insiders feel about the current share price. Notably Richard Griffiths was also the biggest buyer, having purchased UK£1.3m worth of shares.
Over the last year, we can see that insiders have bought 8.13m shares worth UK£1.3m. On the other hand they divested 4713099 shares, for UK£680k. Overall, Nanoco Group insiders were net buyers during the last year. Their average price was about UK£0.16. This is nice to see since it implies that insiders might see value around current prices. You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Nanoco Group is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Nanoco Group Insiders Are Selling The Stock
Over the last three months, we've seen notably more insider selling, than insider buying, at Nanoco Group. In total, insider Richard Griffiths sold UK£629k worth of shares in that time. On the flip side, insider Richard Griffiths spent UK£331k on purchasing shares. Since the selling really does outweigh the buying, we'd say that these transactions may suggest that some insiders feel the company has been fully valued in recent months.
Insider Ownership of Nanoco Group
Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. Insiders own 18% of Nanoco Group shares, worth about UK£5.3m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
So What Do The Nanoco Group Insider Transactions Indicate?
The insider sales have outweighed the insider buying, at Nanoco Group, in the last three months. On the other hand, the insider transactions over the last year are encouraging. And insiders do own shares. So we're not overly bothered by recent selling. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For instance, we've identified 6 warning signs for Nanoco Group (2 are concerning) you should be aware of.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.
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.
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