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We often see insiders buying up shares in companies that perform well over the long term. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So before you buy or sell Wm Morrison Supermarkets PLC (LON:MRW), you may well want to know whether insiders have been buying or selling.
Do Insider Transactions Matter?
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 equally, we would consider it foolish to ignore insider transactions altogether. For example, a Columbia 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'.
Check out our latest analysis for Wm Morrison Supermarkets
The Last 12 Months Of Insider Transactions At Wm Morrison Supermarkets
The Group Chief Finance & Commercial Officer and Executive Director, Trevor Strain, made the biggest insider sale in the last 12 months. That single transaction was for UK£426k worth of shares at a price of UK£2.13 each. So what is clear is that an insider saw fit to sell at around the current price of UK£1.98. While we don't usually like to see insider selling, it's more concerning if the sales take price at a lower price. We note that this sale took place at around the current price, so it isn't a major concern, though it's hardly a good sign. Trevor Strain was the only individual insider to sell shares in the last twelve months.
The chart below shows insider transactions (by individuals) 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!
For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Insider Ownership
For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. Insiders own 0.1% of Wm Morrison Supermarkets shares, worth about UK£6.6m, according to our data. Whilst better than nothing, we're not overly impressed by these holdings.