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Read This Before Selling Brambles Limited (ASX:BXB) Shares

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We often see insiders buying up shares in companies that perform well over the long term. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So shareholders might well want to know whether insiders have been buying or selling shares in Brambles Limited (ASX:BXB).

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, most countries require that the company discloses such transactions to the market.

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We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Harvard University study found that ‘insider purchases earn abnormal returns of more than 6% per year.’

Check out our latest analysis for Brambles

Brambles Insider Transactions Over The Last Year

Elizabeth Fagan made the biggest insider purchase in the last 12 months. That single transaction was for AU$218k worth of shares at a price of AU$10.92 each. That implies that an insider found the current (approximate) price enticing. 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. In any event it’s generally a positive if insiders are buying shares at around the current price.

In the last twelve months insiders paid AU$228k for 20.96k shares purchased. Overall, Brambles insiders were net buyers last year. Their average price was about AU$10.88. Although they bought at below the recent price of AU$11.24 per share, it is good to see that insiders are willing to invest in the company. 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!

ASX:BXB Insider Trading February 7th 19
ASX:BXB Insider Trading February 7th 19

If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).

Are Brambles Insiders Buying Or Selling?

Insiders bought just US$2.6k worth of shares in that time. That’s not much at all. Overall, we don’t think these recent trades are particularly informative, one way or the other.

Does Brambles Boast High 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 AU$3.0m worth of Brambles stock, about 0.02% of the company. I generally like to see higher levels of ownership.

What Might The Insider Transactions At Brambles Tell Us?

Insider purchases have outweighed sales, in the last three months. But the difference isn’t much. On a brighter note, the transactions over the last year are encouraging. We’d like to see bigger individual holdings. However, we don’t see anything to make us think Brambles insiders are doubting the company. Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for Brambles.

But note: Brambles 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.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.