Whilst it may not be a huge deal, we thought it was good to see that the ArcAroma AB (publ) (STO:AAP B) Director, Per-Ola Rosenqvist, recently bought kr96k worth of stock, for kr19.12 per share. That might not be a big purchase but it only increased their holding by 1.1%, and could be interpreted as a good sign.
The Last 12 Months Of Insider Transactions At ArcAroma
In fact, the recent purchase by Director Per-Ola Rosenqvist was not their only acquisition of ArcAroma shares this year. Earlier in the year, they paid kr20.80 per share in a kr107k purchase. That means that even when the share price was higher than kr19.40 (the recent price), an insider wanted to purchase shares. 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 is very important. It is encouraging to see an insider paid above the current price for shares, as it suggests they saw value, even at higher levels. Per-Ola Rosenqvist was the only individual insider to buy over the year.
Per-Ola Rosenqvist bought a total of 25.17k shares over the year at an average price of kr20.11. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
ArcAroma is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 9.6% of ArcAroma shares, worth about kr21m, according to our data. But they may have an indirect interest through a corporate structure that we haven't picked up on. Whilst better than nothing, we're not overly impressed by these holdings.
So What Does This Data Suggest About ArcAroma Insiders?
The recent insider purchase is heartening. We also take confidence from the longer term picture of insider transactions. But we don't feel the same about the fact the company is making losses. Insiders likely see value in ArcAroma shares, given these transactions (along with notable insider ownership of the company). If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.
But note: ArcAroma 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.
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