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Generally, when a single insider buys stock, it is usually not a big deal. However, when several insiders are buying, like in the case of National Express Group PLC (LON:NEX), it sends a favourable message to the company's shareholders.
While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.
The Last 12 Months Of Insider Transactions At National Express Group
In the last twelve months, the biggest single purchase by an insider was when Group CEO & Director Jose Garat bought UK£131k worth of shares at a price of UK£2.36 per share. We do like to see buying, but this purchase was made at well below the current price of UK£2.69. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.
In the last twelve months National Express Group insiders were buying shares, but not selling. 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 National Express Group Have Bought Stock Recently
It's good to see that National Express Group insiders have made notable investments in the company's shares. Overall, two insiders shelled out UK£211k for shares in the company -- and none sold. That shows some optimism about the company's future.
Does National Express Group Boast High Insider Ownership?
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. From looking at our data, insiders own UK£1.3m worth of National Express Group stock, about 0.08% of the company. But they may have an indirect interest through a corporate structure that we haven't picked up on. I generally like to see higher levels of ownership.
So What Does This Data Suggest About National Express Group Insiders?
It's certainly positive to see the recent insider purchases. We also take confidence from the longer term picture of insider transactions. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. We would certainly prefer see higher levels of insider ownership but analysis of the insider transactions suggests that National Express Group insiders are expecting a bright future. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Our analysis shows 2 warning signs for National Express Group (1 doesn't sit too well with us!) and we strongly recommend you look at these before investing.
But note: National Express 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.