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Insiders Show Increased Optimism About JD Sports Fashion
Multiple insiders at JD Sports Fashion Plc (LON:JD.) have significantly increased their position in the company’s shares over the past year. This suggests that insiders are optimistic about the future prospects of the company.
While insider transactions are not the sole indicator for long-term investing decisions, completely ignoring them would be unwise.
The Last 12 Months of Insider Transactions
The largest insider purchase in the last 12 months was made by the Independent Non-Executive Chairman Andrew Higginson. He bought shares worth UK£397k at a price of UK£1.33 each. It is worth noting that this purchase was below the recent stock price of UK£1.53. Although it implies that insiders see the stock as undervalued at lower prices, it does not provide much insight into their opinion of current prices.
Throughout the past year, insiders at JD Sports Fashion have only been buying shares and have not been selling. The chart below illustrates insider transactions by companies and individuals over the previous year.
In addition to JD Sports Fashion, there are other companies where insiders are buying shares. It is advised not to overlook this list of growing companies that insiders are buying.
Recent Insider Stock Purchases at JD Sports Fashion
In the most recent quarter, Non-Executive Director Andrew Long bought shares worth UK£29k. It is positive to see only buyers and no sellers; however, the amount invested in this case is relatively small.
Insider Ownership
When considering a company, it can be helpful to evaluate the total insider shareholdings to assess their alignment with common shareholders. Ideally, there should be a relatively high level of insider ownership. Based on our data, JD Sports Fashion insiders own approximately 0.03% of the stock, equivalent to UK£2.4m. It is important to note that insiders may have indirect interests through private companies or other corporate structures. Generally, higher levels of ownership are preferred.
Insider Transactions Provide Insights
While insider purchases in the last three months have been minimal, there has been no selling activity. The overall net investment is not substantial enough to generate significant confidence. However, the transactions observed over the past year are encouraging. Larger individual holdings by insiders would provide greater reassurance. At present, there is no evidence to suggest that JD Sports Fashion insiders doubt the company. These insider transactions contribute to forming an investment thesis, but it is crucial to consider the risks associated with the company. Our analysis has identified 2 warning signs for JD Sports Fashion, which should not be disregarded.
Please note that JD Sports Fashion may not be the best stock to purchase. For a free list of interesting companies with high ROE and low debt, take a look.
Valuation Analysis
For a comprehensive analysis of JD Sports Fashion, including fair value estimates, risks and warnings, dividends, insider transactions, and financial health, you can view our Free Analysis.
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This article by Simply Wall St is general in nature. It is based on historical data and analyst forecasts, utilizing an unbiased methodology. Our articles should not be considered as financial advice or a recommendation to buy or sell any stock, and they do not take into account individual objectives or financial situations. We aim to provide long-term focused analysis using fundamental data but acknowledge that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St does not hold positions in any stocks mentioned.
