Don't Ignore The Insider Selling In AXIA Energia
We wouldn't blame AXIA Energia SA (BVMF:AXIA3) shareholders if they were a little worried about the fact that Pedro de Lima Filho, the Independent Director recently netted about R$28m selling shares at an average price of R$53.23. However, that sale only accounted for 2.4% of their holding, so arguably it doesn't say much about their conviction.
AXIA Energia Insider Transactions Over The Last Year
Notably, that recent sale by Independent Director Pedro de Lima Filho was not the only time they sold AXIA Energia shares this year. They previously made an even bigger sale of -R$78m worth of shares at a price of R$60.85 per share. So we know that an insider sold shares at around the present share price of R$55.75. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. We note that this sale took place at around the current price, so it isn't a major concern, though it's hardly a good sign.
In the last twelve months insiders purchased 1.60m shares for R$87m. On the other hand they divested 11.34m shares, for R$613m. Over the last year we saw more insider selling of AXIA Energia shares, than buying. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
View our latest analysis for AXIA Energia
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Insider Ownership Of AXIA Energia
For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. It's great to see that AXIA Energia insiders own 1.4% of the company, worth about R$2.2b. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
So What Do The AXIA Energia Insider Transactions Indicate?
The stark truth for AXIA Energia is that there has been more insider selling than insider buying in the last three months. And our longer term analysis of insider transactions didn't bring confidence, either. But since AXIA Energia is profitable and growing, we're not too worried by this. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. For example - AXIA Energia has 4 warning signs we think you should be aware of.
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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.