Kelly Partners Group Holdings Limited's (ASX:KPG) value has fallen 13% in the last week, but insiders who sold AU$1.1m worth of stock over the last year have had less success. Insiders might have been better off holding onto their shares, given that the average selling price of AU$10.40 is still below the current share price.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.
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The Independent Non Executive Director, Ryan MacNamee, made the biggest insider sale in the last 12 months. That single transaction was for AU$682k worth of shares at a price of AU$11.70 each. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The silver lining is that this sell-down took place above the latest price (AU$9.30). So it is hard to draw any strong conclusion from it.
Over the last year we saw more insider selling of Kelly Partners Group Holdings shares, than buying. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Check out our latest analysis for Kelly Partners Group Holdings
If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: Most of them are flying under the radar).
The last three months saw significant insider selling at Kelly Partners Group Holdings. In total, insiders sold AU$964k worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.
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. Kelly Partners Group Holdings insiders own 51% of the company, currently worth about AU$213m based on the recent share price. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
Insiders sold stock recently, but they haven't been buying. And our longer term analysis of insider transactions didn't bring confidence, either. On the plus side, Kelly Partners Group Holdings makes money, and is growing profits. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For example, Kelly Partners Group Holdings has 3 warning signs (and 1 which is a bit unpleasant) we think you should know about.
Of course Kelly Partners Group Holdings may not be the best stock to buy. So you may wish to see this free collection of high quality 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 of direct interests only, but not derivative transactions or indirect interests.
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