16.Jul .2019 10:21

How Much Are TBC Bank Group PLC Insiders Taking Off The Table?

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This article first appeared on Yahoo Business & Simply Wall St.

Do Insider Transactions Matter?


Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock on the market. However, most countries require that the company discloses such transactions to the market.

Insider transactions are not the most important thing when it comes to long-term investing. But it is perfectly logical to keep tabs on what insiders are doing. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.'

TBC Bank Group Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the Co-Founder & Chairman, Mamuka Khazaradze, sold UK£13m worth of shares at a price of UK£15.85 per share. That means that an insider was selling shares at around the current price of UK£15.54. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. In this case, the big sale took place at around the current price, so it's not too bad (but it's still not a positive).

We note that in the last year insiders divested 998k shares for a total of UK£16m. TBC Bank Group insiders didn't buy any shares over the last year. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!


TBC Bank Group Insiders Are Selling The Stock

The last three months saw significant insider selling at TBC Bank Group. In total, insiders dumped GEL16m worth of shares in that time, and we didn't record any purchases whatsoever. In light of this it's hard to argue that all the insiders think that the shares are a bargain.

Insider Ownership

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. It's great to see that TBC Bank Group insiders own 20% of the company, worth about UK£169m. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Does This Data Suggest About TBC Bank Group Insiders?

Insiders sold TBC Bank Group shares recently, but they didn't buy any. And even if we look to the last year, we didn't see any purchases. On the plus side, TBC Bank Group makes money, and is growing profits. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales.

Source - Yahoo Business