Last week, Pro Medicus Limited's (ASX:PME) stock jumped 20%, but insiders who sold AU$514m worth of stock in over the past year are likely to be in a better position. Selling at an average price of AU$257, which is higher than the current price, may have been the best move for these insiders because their investment would have been worth less now than when they sold.

While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

We check all companies for important risks. See what we found for Pro Medicus in our free report.

The Last 12 Months Of Insider Transactions At Pro Medicus

In the last twelve months, the biggest single sale by an insider was when the Co-Founder, Anthony Hall, sold AU$257m worth of shares at a price of AU$257 per share. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. The silver lining is that this sell-down took place above the latest price (AU$213). So it is hard to draw any strong conclusion from it.

Over the last year, we can see that insiders have bought 525.00 shares worth AU$97k. But they sold 2.00m shares for AU$514m. All up, insiders sold more shares in Pro Medicus than they bought, over the last year. They sold for an average price of about AU$257. We are not joyful about insider selling. However, we do note that the average sale price was significantly higher than the current share price (which is AU$213). You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

Check out our latest analysis for Pro Medicus

If you are like me, then you will not want to miss this free list of small cap stocks that are not only being bought by insiders but also have attractive valuations.

Insiders At Pro Medicus Have Bought Stock Recently

We saw some Pro Medicus insider buying shares in the last three months. Insiders purchased AU$45k worth of shares in that period. We like it when there are only buyers, and no sellers. But in this case the amount purchased means the recent transaction may not be very meaningful on its own.

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. Pro Medicus insiders own about AU$11b worth of shares (which is 49% 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 Does This Data Suggest About Pro Medicus Insiders?

Our data shows a little insider buying, but no selling, in the last three months. Overall the buying isn't worth writing home about. It's heartening that insiders own plenty of stock, but we'd like to see more insider buying, since the last year of Pro Medicus insider transactions don't fill us with confidence. If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

But note: Pro Medicus 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 of direct interests only, but not derivative transactions or indirect interests.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.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.