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 before you buy or sell Goodwin plc (LON:GDWN), you may well want to know whether insiders have been buying or selling.
What Is Insider Selling?
It’s quite normal to see company insiders, such as board members, trading in company stock, from time to time. 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 logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Colombia 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’.
The Last 12 Months Of Insider Transactions At Goodwin
Over the last year, we can see that the biggest insider sale was by Executive Director Timothy Goodwin for UK£238k worth of shares, at about UK£29.20 per share. So what is clear is that an insider saw fit to sell at around the current price of UK£25.20, although they might be selling for a variety of reasons.
In the last twelve months insiders netted UK£952k for 32.60k shares sold. In total, Goodwin insiders sold more than they bought over the last year. They sold for an average price of about UK£29.20. While some insiders have decided to take some money off the table, we wouldn’t put too much weight on this fact.
The chart below shows insider transactions over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.
Insiders at Goodwin Have Sold Stock Recently
In total, insiders sold UK952k worth of shares in the last three months. However, we note that J.M. Securities, a private company associated with directors R S Goodwin and J W Goodwin, purchased all of these securities at above the current market price. The total holdings between the beneficial and non-beneficial parties remains unchanged. We do not think these transactions are concerning.
Many investors like to check how much of a company is owned by insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It’s great to see that Goodwin insiders own 53% of the company, worth about UK£98m. 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 Goodwin Insiders?
Looking to the last twelve months, it is good to see that Goodwin is growing earnings. Insiders own shares, but we’re still pretty cautious, given the history of sales. So we’d only buy after careful consideration. I like to dive deeper into how a company has performed in the past. You can access this interactive graph of past earnings, revenue and cash flow for free .
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at firstname.lastname@example.org.