Even if it's not a huge purchase, we think it was good to see that James North, the Group COO of Ferrexpo plc (LON:FXPO) recently shelled out UK£55k to buy stock, at UK£3.86 per share. Although the purchase is not a big one, increasing their shareholding by only 4.9%, it can be interpreted as a good sign.
The Last 12 Months Of Insider Transactions At Ferrexpo
Over the last year, we can see that the biggest insider sale was by the Chief Financial Officer of OJSC Ferrexpo Poltava Mining, Nikoley Kladiev, for UK£69k worth of shares, at about UK£3.45 per share. That means that an insider was selling shares at slightly below the current price (UK£3.91). We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. This single sale was just 15% of Nikoley Kladiev's stake. Nikoley Kladiev was the only individual insider to sell shares in the last twelve months.
Happily, we note that in the last year insiders paid UK£143k for 56.10k shares. But insiders sold 20.00k shares worth UK£69k. In total, Ferrexpo insiders bought more than they sold over the last year. Their average price was about UK£2.55. It is certainly positive to see that insiders have invested their own money in the company. However, you should keep in mind that they bought when the share price was meaningfully below today's levels. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
Ferrexpo is not the only stock that insiders are buying. 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 of Ferrexpo
For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Ferrexpo insiders own 51% of the company, currently worth about UK£1.2b 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.
So What Does This Data Suggest About Ferrexpo Insiders?
It is good to see recent purchasing. We also take confidence from the longer term picture of insider transactions. Along with the high insider ownership, this analysis suggests that insiders are quite bullish about Ferrexpo. That's what I like to see! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. To that end, you should learn about the 3 warning signs we've spotted with Ferrexpo (including 1 which is a bit concerning).
But note: Ferrexpo 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, but not derivative transactions.
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. 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.
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