In This Article:
We often see insiders buying up shares in companies that perform well over the long term. On the other hand, we'd be remiss not to mention that insider sales have been known to precede tough periods for a business. So before you buy or sell J. B. Chemicals & Pharmaceuticals Limited (NSE:JBCHEPHARM), you may well want to know whether insiders have been buying or selling.
Do Insider Transactions Matter?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock on the market. However, most countries require that the company discloses such transactions to the market.
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. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.'
Check out our latest analysis for J. B. Chemicals & Pharmaceuticals
The Last 12 Months Of Insider Transactions At J. B. Chemicals & Pharmaceuticals
The , Nitin Doshi, made the biggest insider sale in the last 12 months. That single transaction was for ₹9.6m worth of shares at a price of ₹319 each. That means that even when the share price was below the current price of ₹368, an insider wanted to cash in some shares. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. We note that the biggest single sale was only 12% of Nitin Doshi's holding. Nitin Doshi was the only individual insider to sell over the last year.
You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.
Insider Ownership
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. J. B. Chemicals & Pharmaceuticals insiders own about ₹17b worth of shares (which is 56% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
So What Do The J. B. Chemicals & Pharmaceuticals Insider Transactions Indicate?
There haven't been any insider transactions in the last three months -- that doesn't mean much. While we feel good about high insider ownership of J. B. Chemicals & Pharmaceuticals, we can't say the same about the selling of shares. Of course, the future is what matters most. So if you are interested in J. B. Chemicals & Pharmaceuticals, you should check out this free report on analyst forecasts for the company.