By selling US$4.3m worth of FREYR Battery, Inc. (NYSE:FREY) stock at an average sell price of US$1.71 over the last year, insiders seemed to have made the most of their holdings. The company's market cap plunged by US$78m after price dropped by 20% last week but insiders were able to limit their loss to an extent.

While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

The Last 12 Months Of Insider Transactions At FREYR Battery

In the last twelve months, the biggest single sale by an insider was when the Founder & Director, Tore Slettemoen, sold US$1.9m worth of shares at a price of US$1.74 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of US$1.99. 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. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. This single sale was just 17% of Tore Slettemoen's stake. The only individual insider seller over the last year was Tore Slettemoen.

Tore Slettemoen ditched 2.50m shares over the year. The average price per share was US$1.71. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: Most of them are flying under the radar).

FREYR Battery Insiders Are Selling The Stock

There was substantially more insider selling, than buying, of FREYR Battery shares over the last three months. In total, Founder & Director Tore Slettemoen sold US$4.3m worth of shares in that time. On the flip side, Chief Financial Officer Evan Calio spent US$1.2m on purchasing shares (as mentioned above) . The share price has moved a bit recently, but it's hard to argue that the selling is a positive.

Insider Ownership

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 9.2% of FREYR Battery shares, worth about US$28m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

What Might The Insider Transactions At FREYR Battery Tell Us?

Unfortunately, there has been more insider selling of FREYR Battery stock, than buying, in the last three months. Despite some insider buying, the longer term picture doesn't make us feel much more positive. While insiders do own shares, they don't own a heap, and they have been selling. So we'd only buy after careful consideration. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing FREYR Battery. For instance, we've identified 3 warning signs for FREYR Battery (2 can't be ignored) you should be aware of.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.

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.