It is not uncommon to see companies perform well in the years after insiders buy shares. On the other hand, we'd be remiss not to mention that insider sales have been known to precede tough periods for a business. So before you buy or sell NetSol Technologies, Inc. (NASDAQ:NTWK), you may well want to know whether insiders have been buying or selling.
What Is Insider Buying?
It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, rules govern insider transactions, and certain disclosures are required.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. 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'.
NetSol Technologies Insider Transactions Over The Last Year
The Founder Najeeb Ghauri made the biggest insider purchase in the last 12 months. That single transaction was for US$50k worth of shares at a price of US$3.04 each. That means that an insider was happy to buy shares at around the current price of US$3.27. That means they have been optimistic about the company in the past, though they may have changed their mind. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. Happily, the NetSol Technologies insiders decided to buy shares at close to current prices.
NetSol Technologies insiders may have bought shares in the last year, but they didn't sell any. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
Insiders at NetSol Technologies Have Bought Stock Recently
It's good to see that NetSol Technologies insiders have made notable investments in the company's shares. Founder Najeeb Ghauri spent US$82k on stock, and there wasn't any selling. This could be interpreted as suggesting a positive outlook.
Insider Ownership of NetSol Technologies
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. Our data indicates that NetSol Technologies insiders own about US$5.0m worth of shares (which is 14% of the company). Whilst better than nothing, we're not overly impressed by these holdings.
What Might The Insider Transactions At NetSol Technologies Tell Us?
It's certainly positive to see the recent insider purchase. We also take confidence from the longer term picture of insider transactions. On this analysis the only slight negative we see is the fairly low (overall) insider ownership; their transactions suggest that they are quite positive on NetSol Technologies stock. While we like knowing 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. Case in point: We've spotted 3 warning signs for NetSol Technologies you should be aware of.
But note: NetSol Technologies 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, but not derivative transactions.
This article by Simply Wall St is general in nature. 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.
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