With the price of Industrials REIT Limited (JSE:MLI) down 10% this week, insiders may find some comfort after selling £106 million worth of shares earlier this year.
Over the past year, insiders have sold £106m worth of Industrials REIT Limited (JSE:MLI) at an average price of £35.27 per share, giving them the most for their money. After the share price fell 10% last week, the company’s market value fell by R860 million, but insiders were able to mitigate their losses.
While insider trading isn’t the most important thing when it comes to long-term investing, we think it makes perfect sense to keep tabs on what insiders are doing.
See our latest analysis for Industrials REIT
Industry REIT Insider Trading Over the Past Year
CEO and Executive Director Paul Arenson has made the largest insider sale in the last 12 months. This single transaction involved R106 million worth of shares at a price of R35.27 each. Although insider selling is negative, for us it is even more negative if the stock is sold at a lower price. The good news is that this big sale was well above the current price of R25.57. So this may not tell us anything about what insiders think of the current stock price. Paul Arenson was the only individual insider to sell in the past year.
Fortunately, we note that last year insiders paid R1.3 million for 35,000 shares. But insiders sold 3.00 million shares worth R106 million. The chart below shows insider trading (by companies and individuals) over the past year. If you click on the chart, you can see all individual trades including stock price, individual and date!
If you like buying stocks that insiders are buying, rather than selling, then you might love this free list of companies. (Hint: insiders bought them).
Industry REIT Insiders Sell Stock
Over the past three months, we have seen significant insider selling at Industrials REIT. In total, CEO and Executive Director Paul Arenson sold R106 million worth of shares during this time, and we recorded no purchases. This may suggest that some insiders think stocks aren’t cheap.
Insider ownership of industrial REITs
Another way to test alignment between a company’s executives and other shareholders is to look at how many shares they own. I think it’s a good sign if insiders have a significant number of shares in the company. Industrial REIT insiders hold around R479 million worth of shares. This equates to 6.4% of the business. While this is a high but not exceptional level of insider ownership, it suffices to indicate some alignment between management and small shareholders.
So what does this data suggest about industrial REIT insiders?
An insider hasn’t bought Industrials REIT stock in the past three months, but there have been some sales. Despite some insider buying, the longer-term picture doesn’t make us much more positive. But it’s good to see that Industrials REIT is increasing its profits. The company enjoys strong insider ownership, but we are a little hesitant given the history of stock sales. While we like 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. At Simply Wall St, we have found that Industrials REIT has 4 warning signs (1 not to be neglected!) which deserve your attention before going further in your analysis.
Sure, you might find a fantastic investment by looking elsewhere. So take a look at this free list of interesting companies.
For the purposes of this article, insiders are persons who report their transactions to the relevant regulatory body. We currently record open market transactions and private dispositions, but not derivative transactions.
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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.
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