From what we can discern, the past 12 months witnessed a surge in insider activity within Ocado Group plc (LON: OCDO). Notably, insiders displayed a greater inclination towards acquiring rather than offloading company stocks.
While insider transactions may not hold paramount importance in the realm of long-term investments, it is prudent to pay heed to the actions of insiders in terms of buying or selling shares.
Insider Transactions at Ocado Group Over the Last 12 Months
The largest insider purchase in the past year was made by Jorn Rausing, the Independent Non-Executive Director. This notable transaction amounted to UK£4.7m, acquiring shares at a price of UK£6.68 each. It is worth noting that the insider chose to procure shares at a value surpassing the current price of UK£4.55. While it remains possible that regrets may surface in relation to the purchase, it is more likely that the insider holds a bullish outlook on the company. In our assessment, the price at which insiders procure shares bears significant weight. As a general principle, we hold a more positive outlook on a stock when insiders purchase shares at prices exceeding the prevailing rates. This suggests that they perceive the stock to possess good value, even at higher prices. It is important to highlight that Jorn Rausing was the sole individual insider to engage in share acquisition over the past year.
Over the course of the last 12 months, Jorn Rausing acquired 1.12m shares at an average price of UK£6.59. A visual representation of insider transactions, encompassing both companies and individuals, within this period, can be found below. For detailed information regarding sellers, sale prices, and timing.
Insider Ownership of Ocado Group
An additional means of evaluating the alignment between a company’s leaders and other shareholders is by examining the extent of their share ownership. In general, higher insider ownership augments the likelihood of insiders being motivated to foster long-term growth within the company. It is indeed heartening to observe that Ocado Group insiders possess a 13% ownership stake in the company, valued at approximately UK£497m. Such substantial ownership by insiders generally enhances the probability of the company’s operations being conducted in the best interests of all shareholders.
Insights from Insider Transactions at Ocado Group
The absence of insider trades involving Ocado Group shares in the past quarter does not hold significant implications. However, insiders have exhibited a heightened interest in the stock over the past year. While it would be encouraging to witness further insider purchases, the overall alignment of Ocado Group insiders, who possess a considerable portion of the company’s shares, suggests optimism for the future. While it is beneficial to be aware of insider activities in terms of buying or selling, understanding the risks confronting a particular company is equally essential. In terms of investment risks, we have identified three warning signs pertaining to Ocado Group, and comprehending these should form an integral part of your investment process.