Trade Alert: Company Secretary Of Scales Steve Kennelly Has Sold Stock

Anyone interested in Scales Corporation Limited (NZSE:SCL) should probably be aware that the Company Secretary, Steve Kennelly, recently divested NZ$358k worth of shares in the company, at an average price of NZ$6.99 each. That sale was 46% of their holding, so it does make us raise an eyebrow.

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The Last 12 Months Of Insider Transactions At Scales

Over the last year, we can see that the biggest insider purchase was by Non-Executive Independent Director Miranda Burdon for NZ$706k worth of shares, at about NZ$5.93 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of NZ$7.06. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

Happily, we note that in the last year insiders paid NZ$742k for 124.13k shares. On the other hand they divested 215.83k shares, for NZ$1.4m. All up, insiders sold more shares in Scales than they bought, over the last year. 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!

View our latest analysis for Scales

For those who like to find hidden gems this free list of small cap companies with recent insider purchasing, could be just the ticket.

Insider Ownership

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. Scales insiders own about NZ$36m worth of shares. That equates to 3.5% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

What Might The Insider Transactions At Scales Tell Us?

The insider sales have outweighed the insider buying, at Scales, in the last three months. Zooming out, the longer term picture doesn't give us much comfort. On the plus side, Scales makes money, and is growing profits. While insiders do own shares, they don't own a heap, and they have been selling. We're in no rush to buy! 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 - Scales has 3 warning signs we think you should be aware of.

But note: Scales 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.

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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.