Some Ramsay Health Care Limited (ASX:RHC) shareholders may be a little concerned to see that the Independent Non-Executive Director, Michael Siddle, recently sold a substantial AU$49m worth of stock at a price of AU$49.00 per share. That sale reduced their total holding by 26% which is hardly insignificant, but far from the worst we’ve seen.
Ramsay Health Care Insider Transactions Over The Last Year
In fact, the recent sale by Michael Siddle was the biggest sale of Ramsay Health Care shares made by an insider individual in the last twelve months, according to our records. That means that an insider was selling shares at slightly below the current price (AU$51.53). We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. However, while insider selling is sometimes discouraging, it’s only a weak signal. This single sale was just 26% of Michael Siddle’s stake.
Happily, we note that in the last year insiders paid AU$630k for 15.70k shares. But insiders sold 1.00m shares worth AU$49m. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Check out our latest analysis for Ramsay Health Care
I will like Ramsay Health Care better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.
Insider Ownership
For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Ramsay Health Care insiders own about AU$179m worth of shares (which is 1.5% of the company). I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
So What Do The Ramsay Health Care Insider Transactions Indicate?
An insider hasn’t bought Ramsay Health Care stock in the last three months, but there was some selling. Zooming out, the longer term picture doesn’t give us much comfort. But since Ramsay Health Care is profitable and growing, we’re not too worried by this. It is good to see high insider ownership, but the insider selling leaves us cautious. So these insider transactions can help us build a thesis about the stock, but it’s also worthwhile knowing the risks facing this company. For example, Ramsay Health Care has 2 warning signs (and 1 which is concerning) we think you should know about.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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.