Insiders Sold Beforepay Group Prematurely At AU$2.70 With Stock Trading Higher
Beforepay Group Limited's (ASX:B4P) value has fallen 15% in the last week, but insiders who sold AU$108k worth of stock over the last year have had less success. Given that the average selling price of AU$2.70 is still lower than the current share price, insiders would probably have been better off keeping their shares.
While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.
The Last 12 Months Of Insider Transactions At Beforepay Group
The Non Executive Independent Chairman, Brian Hartzer, made the biggest insider sale in the last 12 months. That single transaction was for AU$108k worth of shares at a price of AU$2.70 each. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The good news is that this large sale was at well above current price of AU$1.18. So it may not tell us anything about how insiders feel about the current share price. Brian Hartzer was the only individual insider to sell over the last year.
You can see the insider transactions (by companies and individuals) over the last year depicted in the chart 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 Beforepay Group
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.
Does Beforepay Group Boast High 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. I reckon it's a good sign if insiders own a significant number of shares in the company. Our data indicates that Beforepay Group insiders own about AU$6.6m worth of shares (which is 11% of the company). However, it's possible that insiders might have an indirect interest through a more complex structure. Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!
So What Do The Beforepay Group Insider Transactions Indicate?
The fact that there have been no Beforepay Group insider transactions recently certainly doesn't bother us. Our analysis of Beforepay Group insider transactions leaves us unenthusiastic. We also note that, as far as we can see, insider ownership is fairly low, compared to other companies. 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 Beforepay Group (including 2 which make us uncomfortable).
But note: Beforepay Group 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.