Insiders See US$748.1k Investment In Trinseo Jump Last Week

Last week, Trinseo PLC (NYSE:TSE) insiders, who had purchased shares in the previous 12 months were rewarded handsomely. The shares increased by 27% last week, resulting in a US$45m increase in the company's market worth, implying a 112% gain on their initial purchase. In other words, the original US$748.1k purchase is now worth US$1.58m.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

Check out our latest analysis for Trinseo

The Last 12 Months Of Insider Transactions At Trinseo

The Independent Director Jeffrey Cote made the biggest insider purchase in the last 12 months. That single transaction was for US$453k worth of shares at a price of US$3.39 each. Even though the purchase was made at a significantly lower price than the recent price (US$5.96), we still think insider buying is a positive. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

Happily, we note that in the last year insiders paid US$748k for 265.60k shares. But they sold 11.14k shares for US$28k. In the last twelve months there was more buying than selling by Trinseo insiders. The average buy price was around US$2.82. It is certainly positive to see that insiders have invested their own money in the company. However, you should keep in mind that they bought when the share price was meaningfully below today's levels. 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!

There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. Our data suggests Trinseo insiders own 2.4% of the company, worth about US$4.4m. We prefer to see high levels of insider ownership.

So What Do The Trinseo Insider Transactions Indicate?

There haven't been any insider transactions in the last three months -- that doesn't mean much. But insiders have shown more of an appetite for the stock, over the last year. We'd like to see bigger individual holdings. However, we don't see anything to make us think Trinseo insiders are doubting the company. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. Be aware that Trinseo is showing 4 warning signs in our investment analysis, and 3 of those don't sit too well with us...

But note: Trinseo 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 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.