Finance
Pleasing Signs As A Number Of Insiders Buy Distribution Finance Capital Holdings Stock
When a single insider purchases stock, it is typically not a major deal. However, when multiple insiders purchase stock, like in Distribution Finance Capital Holdings plc’s (LON:DFCH) instance, it’s good news for shareholders.
Although we don’t think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.
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In fact, the recent purchase by Carl D’Ammassa was the biggest purchase of Distribution Finance Capital Holdings shares made by an insider individual in the last twelve months, according to our records. So it’s clear an insider wanted to buy, even at a higher price than the current share price (being UK£0.33). It’s very possible they regret the purchase, but it’s more likely they are bullish about the company. In our view, the price an insider pays for shares is very important. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.
While Distribution Finance Capital Holdings insiders bought shares during the last year, they didn’t sell. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Check out our latest analysis for Distribution Finance Capital Holdings
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.
It’s good to see that Distribution Finance Capital Holdings insiders have made notable investments in the company’s shares. Overall, two insiders shelled out UK£62k for shares in the company — and none sold. This is a positive in our book as it implies some confidence.
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it’s a good sign if insiders own a significant number of shares in the company. Based on our data, Distribution Finance Capital Holdings insiders have about 1.1% of the stock, worth approximately UK£613k. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. We consider this fairly low insider ownership.
The recent insider purchases are heartening. And an analysis of the transactions over the last year also gives us confidence. While the overall levels of insider ownership are below what we’d like to see, the history of transactions imply that Distribution Finance Capital Holdings insiders are reasonably well aligned, and optimistic for the future. While it’s good to be aware of what’s going on with the insider’s ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. At Simply Wall St, we’ve found that Distribution Finance Capital Holdings has 2 warning signs (1 shouldn’t be ignored!) that deserve your attention before going any further with your analysis.
But note: Distribution Finance Capital Holdings may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.
For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions of direct interests only, but not derivative transactions or indirect interests.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using 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 account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.