Great news for DDH1 Limited (ASX:DDH): Insiders acquired stock in large numbers last year
It is usually uneventful when a single insider buys stock. However, When quite a few insiders buy shares, as it happened in DDH1 Limited's (ASX:DDH) case, it's fantastic news for shareholders.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
Check out our latest analysis for DDH1
The Last 12 Months Of Insider Transactions At DDH1
In fact, the recent purchase by Diane Smith-Gander was the biggest purchase of DDH1 shares made by an insider individual in the last twelve months, according to our records. So it's clear an insider wanted to buy, even at a higher price than the current share price (being AU$0.86). While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. To us, it's very important to consider the price insiders pay for shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.
In the last twelve months DDH1 insiders were buying shares, but not selling. They paid about AU$0.99 on average. I'd consider this a positive as it suggests insiders see value at around the current price, which is AU$0.86. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).
Insiders at DDH1 Have Bought Stock Recently
It's good to see that DDH1 insiders have made notable investments in the company's shares. Overall, two insiders shelled out AU$105k for shares in the company -- and none sold. That shows some optimism about the company's future.
Insider Ownership of DDH1
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. DDH1 insiders own about AU$68m worth of shares. That equates to 24% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
So What Does This Data Suggest About DDH1 Insiders?
It's certainly positive to see the recent insider purchases. We also take confidence from the longer term picture of insider transactions. Insiders likely see value in DDH1 shares, given these transactions (along with notable insider ownership of the company). In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing DDH1. Case in point: We've spotted 3 warning signs for DDH1 you should be aware of, and 1 of these is a bit unpleasant.
Of course DDH1 may not be the best stock to buy. So you may wish to see this free collection of high quality 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, but not derivative transactions.
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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.
