Whilst it may not be a huge deal, we thought it was good to see that the Midway Limited (ASX:MWY) Non-Executive Chairman, Gregory McCormack, recently bought AU$98k worth of stock, for AU$0.98 per share. However, we do note that it only increased their holding by 7.2%, and it wasn't a huge purchase by absolute value, either.
The Last 12 Months Of Insider Transactions At Midway
The Independent Non-Executive Director, Anthony Bennett, made the biggest insider sale in the last 12 months. That single transaction was for AU$140k worth of shares at a price of AU$3.52 each. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. The silver lining is that this sell-down took place above the latest price (AU$0.99). So it may not tell us anything about how insiders feel about the current share price. Anthony Bennett was the only individual insider to sell over the last year.
In the last twelve months insiders purchased 154.17k shares for AU$196k. But they sold 40000 shares for AU$140k. Overall, Midway insiders were net buyers last year. Their average price was about AU$1.27. This is nice to see since it implies that insiders might see value around current prices. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. 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).
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. From looking at our data, insiders own AU$3.4m worth of Midway stock, about 4.2% of the company. However, it's possible that insiders might have an indirect interest through a more complex structure. I generally like to see higher levels of ownership.
So What Do The Midway Insider Transactions Indicate?
The recent insider purchases are heartening. And an analysis of the transactions over the last year also gives us confidence. We would certainly prefer see higher levels of insider ownership but analysis of the insider transactions suggests that Midway insiders are expecting a bright 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. Every company has risks, and we've spotted 5 warning signs for Midway you should know about.
But note: Midway 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, but not derivative transactions.
If you spot an error that warrants correction, please contact the editor at email@example.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
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