The Senior Strategy Advisor of Plus500 Ltd. (LON:PLUS), Alon Gonen, Just Bought 29% More Shares

Those following along with Plus500 Ltd. (LON:PLUS) will no doubt be intrigued by the recent purchase of shares by Alon Gonen, Senior Strategy Advisor of the company, who spent a stonking UK£8.6m on stock at an average price of UK£7.82. Aside from being a solid chunk in its own right, the deft move also saw their holding increase by some 29%.

See our latest analysis for Plus500

The Last 12 Months Of Insider Transactions At Plus500

Notably, that recent purchase by Alon Gonen is the biggest insider purchase of Plus500 shares that we've seen in the last year. That implies that an insider found the current price of UK£8.26 per share to be enticing. 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. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. In this case we're pleased to report that the insider purchases were made at close to current prices.

Plus500 insiders may have bought shares in the last year, but they didn't sell any. Their average price was about UK£5.83. We don't deny that it is nice to see insiders buying stock in the company. However, you should keep in mind that they bought when the share price was meaningfully below today's levels. 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!

LSE:PLUS Recent Insider Trading, March 21st 2020

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company 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. Insiders own 3.6% of Plus500 shares, worth about UK£32m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Do The Plus500 Insider Transactions Indicate?

It is good to see the recent insider purchase. And an analysis of the transactions over the last year also gives us confidence. When combined with notable insider ownership, these factors suggest Plus500 insiders are well aligned, and that they may think the share price is too low. 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 Plus500 you should be aware of, and 1 of these is a bit unpleasant.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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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