Formpipe Software AB (publ) (STO: FPIP) Insiders have sold
We have lost count of the number of times insiders have racked up shares in a company that is improving dramatically. Unfortunately, there are also many examples of a sharp drop in stock prices after insiders sell stocks. So before you buy or sell Formpipe Software AB (publ) (STO: FPIP), you might want to know if any insiders have bought or sold.
What is insider buying?
It is perfectly legal for company insiders, including board members, to buy and sell shares in a company. However, most countries require the company to disclose these transactions to the market.
We don’t believe shareholders should just follow insider trading. But logic dictates that you pay attention to whether insiders are buying or selling stocks. For example, a Columbia University study found that “insiders are more likely to engage in open market purchases of their own company stock when the company is about to reveal new deals with customers and suppliers.”
See our latest review for Formpipe software
Formpipe Software Insider Transactions in the Past Year
Over the past year, we can see that the biggest insider sale was made by CEO and Chairman Christian Sundin for 8.3 million kroner of shares, at around 27.78 kroner per share. . This means that an insider was selling shares at a price slightly lower than the current price (34.90 kr). Generally, we find it disheartening when insiders sell below the current price, as it suggests they were happy with a lower valuation. Please note, however, that sellers can have a variety of reasons for selling, so we are not sure what they think about the stock price. This one-off sale only represented 24% of Christian Sundin’s stake.
Over the past year, we can see that insiders bought 47.50k shares worth 1.3 million kroner. But they sold 321.00k shares for 9.0 million kr. In total, Formpipe Software insiders sold more than they bought last year. You can see insider trading (by companies and individuals) over the past year shown in the graph below. By clicking on the chart below, you can see the exact details of each insider trade!
If you’re like me then you will do not want to miss it free list of growing companies that insiders buy.
Insider Ownership of Formpipe Software
Another way to test the alignment between a company’s executives and other shareholders is to look at how many shares they own. We generally like to see fairly high levels of insider ownership. Formpipe Software insiders own around 275 million kr of shares. This equates to 15% of the business. This level of insider ownership is good, but just nowhere near remarkable. It certainly suggests a reasonable degree of alignment.
So what does this data suggest about Formpipe Software insiders?
We certainly don’t mind the fact that there haven’t been any Formpipe Software insider trading recently. It’s heartwarming that insiders own a lot of stocks, but we would like to see more insider buying as the last year of Formpipe Software’s insider trading does not fill us with confidence. While we love to know what’s going on with insider ownership and trading, we also make sure to consider the risks a stock faces before making an investment decision. You would be interested to know that we have found 1 warning sign for Formpipe software and we suggest you take a look.
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For the purposes of this article, insiders are the people who report their transactions to the relevant regulatory body. We currently account for open market transactions and private assignments, but not derivative transactions.
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This Simply Wall St article is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take into account your goals or your financial situation. We aim to bring you long-term, targeted analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price sensitive companies or qualitative information. Simply Wall St has no position in any of the stocks mentioned.
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