Diploma Insider Lowered Holding By 13% During Last Year

Viewing insider transactions for Diploma PLC's (LON:DPLM ) over the last year, we see that insiders were net sellers. This means that a larger number of shares were sold by insiders in relation to shares purchased.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

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Diploma Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the CEO & Director, Jonathan Thomson, for UK£1.7m worth of shares, at about UK£56.68 per share. That means that an insider was selling shares at slightly below the current price (UK£72.25). When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. We note that the biggest single sale was only 13% of Jonathan Thomson's holding. The only individual insider seller over the last year was Jonathan Thomson.

Over the last year, we can see that insiders have bought 3.92k shares worth UK£250k. But they sold 30.00k shares for UK£1.7m. 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!

Check out our latest analysis for Diploma

I will like Diploma better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Does Diploma Boast High Insider Ownership?

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. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that Diploma insiders own 0.2% of the company, worth about UK£17m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Do The Diploma Insider Transactions Indicate?

The fact that there have been no Diploma insider transactions recently certainly doesn't bother us. Our analysis of Diploma insider transactions leaves us cautious. But we do like the fact that insiders own a fair chunk of the company. Therefore, you should definitely take a look at this FREE report showing analyst forecasts for Diploma.

But note: Diploma 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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