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Insiders who purchased this year lose UK£21k as National Express Group PLC (LON:NEX) stock drops to UK£2.14

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The recent 6.1% drop in National Express Group PLC's (LON:NEX) stock could come as a blow to insiders who purchased UK£69k worth of stock at an average buy price of UK£3.09 over the past 12 months. Insiders buy with the expectation to see their investments rise in value over a period of time. However, recent losses have rendered their above investment worth UK£48k which is not ideal.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

View our latest analysis for National Express Group

The Last 12 Months Of Insider Transactions At National Express Group

In the last twelve months, the biggest single purchase by an insider was when Senior Independent Non-Executive Director Matthew Crummack bought UK£49k worth of shares at a price of UK£3.04 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being UK£2.14). While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. We always take careful note of the price insiders pay when purchasing shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.

While National Express Group 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. By clicking on the graph below, you can see the precise details of each insider transaction!

insider-trading-volume
insider-trading-volume

There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).

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. We usually like to see fairly high levels of insider ownership. From looking at our data, insiders own UK£908k worth of National Express Group stock, about 0.07% of the company. However, it's possible that insiders might have an indirect interest through a more complex structure. We prefer to see high levels of insider ownership.

So What Do The National Express Group Insider Transactions Indicate?

The fact that there have been no National Express Group insider transactions recently certainly doesn't bother us. On a brighter note, the transactions over the last year are encouraging. The transactions are fine but it'd be more encouraging if National Express Group insiders bought more shares in the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing National Express Group. Every company has risks, and we've spotted 1 warning sign for National Express Group you should know about.

But note: National Express Group 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. 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.

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

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