Should You Take Comfort From Insider Transactions At EMIS Group plc (LON:EMIS)?
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We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So we'll take a look at whether insiders have been buying or selling shares in EMIS Group plc (LON:EMIS).
What Is Insider Buying?
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, 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'.
See our latest analysis for EMIS Group
The Last 12 Months Of Insider Transactions At EMIS Group
Over the last year, we can see that the biggest insider purchase was by CEO & Executive Director Andrew Thorburn for UK£60k worth of shares, at about UK£12.07 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being UK£11.96). 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. To us, it's very important to consider the price insiders pay for shares is very important. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.
In the last twelve months insiders paid UK£144k for 12451 shares purchased. In the last twelve months EMIS Group insiders were buying shares, but not selling. You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
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.
EMIS Group Insiders Bought Stock Recently
Over the last quarter, EMIS Group insiders have spent a meaningful amount on shares. Andrew Thorburn spent UK£60k on stock, and there wasn't any selling. This is a positive in our book as it implies some confidence.
Insider Ownership of EMIS Group
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. Our data suggests EMIS Group insiders own 0.1% of the company, worth about UK£852k. We consider this fairly low insider ownership.
What Might The Insider Transactions At EMIS Group Tell Us?
The recent insider purchase is heartening. And an analysis of the transactions over the last year also gives us confidence. On this analysis the only slight negative we see is the fairly low (overall) insider ownership; their transactions suggest that they are quite positive on EMIS Group stock. Of course, the future is what matters most. So if you are interested in EMIS Group, you should check out this free report on analyst forecasts for the company.
Of course EMIS Group 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 aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
