While Foresta Group Holding Limited (ASX:FGH) shareholders have had a good week with the stock up 11%, they shouldn't let their guards down. The fact that insiders chose to dispose of AU$699k worth of stock in the past 12 months even though prices were relatively low could be indicative of some anticipated weakness.

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 Foresta Group Holding

The Last 12 Months Of Insider Transactions At Foresta Group Holding

The insider, Ramon Mountfort, made the biggest insider sale in the last 12 months. That single transaction was for AU$699k worth of shares at a price of AU$0.0044 each. That means that an insider was selling shares at slightly below the current price (AU$0.01). 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. It is worth noting that this sale was only 27% of Ramon Mountfort's holding. Ramon Mountfort was the only individual insider to sell shares in the last twelve months.

In the last twelve months insiders purchased 24.00m shares for AU$160k. On the other hand they divested 158.05m shares, for AU$699k. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

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Foresta Group Holding Insiders Bought Stock Recently

Over the last quarter, Foresta Group Holding insiders have spent a meaningful amount on shares. Overall, two insiders shelled out AU$80k for shares in the company -- and none sold. This is a positive in our book as it implies some confidence.

Does Foresta Group Holding Boast High Insider Ownership?

Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Foresta Group Holding insiders own about AU$13m worth of shares (which is 49% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Does This Data Suggest About Foresta Group Holding Insiders?

The recent insider purchases are heartening. On the other hand the transaction history, over the last year, isn't so positive. Overall, we'd prefer see a more sustained buying from directors, but with a significant insider holding and more recent purchases, Foresta Group Holding insiders are reasonably well aligned, and optimistic for the future. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Case in point: We've spotted 5 warning signs for Foresta Group Holding you should be aware of, and 3 of them are a bit concerning.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.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.