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Positive Signs as Multiple Insiders Buy Sequoia Financial Group Shares
Generally, when a single insider buys shares, it’s usually no big deal. However, when multiple insiders are buying, as in the case of Sequoia Financial Group Limited (ASX:SEQ), sends a favorable message to the company’s shareholders.
While we would never suggest that investors base their decisions solely on what a company’s managers have been doing, we think it is perfectly logical to keep tabs on what insiders are doing.
Check out our latest analysis for Sequoia Financial Group
The last 12 months of insider transactions at Sequoia Financial Group
Insider Brent Jones made the biggest insider purchase in the last 12 months. This single transaction was for AU$535,000 worth of shares priced at AU$0.53 each. So it’s clear that an insider wanted to buy, even at a higher price than the current share price (being AU$0.53). While their opinion may have changed since the purchase was made, this at least suggests they had confidence in the company’s future. In our opinion, the price an insider pays for shares is very important. As a general rule, we feel more positive about a stock if insiders have purchased shares above current prices, because this suggests they viewed the stock as a good value, even at a higher price.
Although Sequoia Financial Group insiders have bought shares over the last year, they have not sold them. The graph below shows internal transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much and when, just click on the graph below!
insider trading volume
There are many other companies that have insiders buying shares. You probably do no I want to lose this free list of undervalued small-cap companies that insiders are buying.
Sequoia Financial Group Insiders Bought Shares Recently
During the last quarter, Sequoia Financial Group members spent a significant amount on stocks. We can see that insider Brent Jones paid AU$535k for shares in the company. Nobody sold. This is a positive in our book as it implies some trust.
Insider Ownership of Sequoia Financial Group
Looking at total insider ownership in a company can help inform your view of whether they are well aligned with common shareholders. High insider ownership often makes company leadership more attentive to shareholder interests. Sequoia Financial Group members own around AU$18 million worth of shares. This is equivalent to 26% of the company. We have certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and other shareholders.
The story continues
So what does this data suggest about the members of Sequoia Financial Group?
The recent insider buying is encouraging. We also take confidence from the long-term picture of internal transactions. However, we note that the company has not made a profit in the last twelve months, which makes us cautious. Insiders likely see value in Sequoia Financial Group shares given these transactions (along with the company’s notable insider ownership). In addition to knowing about ongoing internal transactions, it is beneficial to identify the risks facing Sequoia Financial Group. At Simply Wall St, we discovered that Sequoia Financial Group has 3 warning signs (2 we don’t like!) that deserve your attention before proceeding with your analysis.
If you would prefer to check out another company – one with potentially superior financials – then don’t miss this opportunity free list of interesting companies, which have HIGH return on equity and low debt.
For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently only account for open market transactions and private dispositions of direct interests, but we do not account for derivative transactions or indirect interests.
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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts using only 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 into account your objectives or your financial situation. Our goal is to bring you long-term focused analysis driven by fundamental data. Please note that our analysis may not take into account the latest price-sensitive company announcements or qualitative materials. Simply Wall St has no position in any of the stocks mentioned.