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Insiders rewarded with a UK£39k addition on top of their UK£848k purchase as Associated British Foods plc (LON:ABF) hits UK£13b

·3 min read

Associated British Foods plc (LON:ABF) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 6.3%, resulting in a UK£798m rise in the company's market capitalisation. As a result, their original purchase of UK£848k worth of stock is now worth UK£888k.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

View our latest analysis for Associated British Foods

Associated British Foods Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the Non-Executive Director, Emma Adamo, sold UK£799k worth of shares at a price of UK£20.92 per share. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. The good news is that this large sale was at well above current price of UK£16.99. So it may not tell us anything about how insiders feel about the current share price. The only individual insider seller over the last year was Emma Adamo. Notably Emma Adamo was also the biggest buyer, having purchased UK£848k worth of shares.

Over the last year, we can see that insiders have bought 52.24k shares worth UK£848k. But they sold 38.20k shares for UK£799k. Overall, Associated British Foods insiders were net buyers during the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

insider-trading-volume
insider-trading-volume

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 Associated British Foods Have Bought Stock Recently

Over the last three months, we've seen significant insider buying at Associated British Foods. Overall, three insiders shelled out UK£848k for shares in the company -- and none sold. That shows some optimism about the company's future.

Insider Ownership of Associated British Foods

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. We usually like to see fairly high levels of insider ownership. It appears that Associated British Foods insiders own 0.6% of the company, worth about UK£78m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Do The Associated British Foods Insider Transactions Indicate?

The recent insider purchases are heartening. And the longer term insider transactions also give us confidence. Insiders likely see value in Associated British Foods shares, given these transactions (along with notable insider ownership of the company). 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. You'd be interested to know, that we found 1 warning sign for Associated British Foods and we suggest you have a look.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that 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 account for open market transactions and private dispositions, but not derivative transactions.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.

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