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Insider Buying: Peter Diamond Just Spent AU$120k On Elmore Limited (ASX:ELE) Shares

·3 min read

Even if it's not a huge purchase, we think it was good to see that Peter Diamond, a Elmore Limited (ASX:ELE) insider, recently shelled out AU$120k to buy stock, at AU$0.03 per share. While we're hesitant to get too excited about a purchase of that size, we do note it increased their holding by a solid 14%.

View our latest analysis for Elmore

The Last 12 Months Of Insider Transactions At Elmore

Notably, that recent purchase by insider Peter Diamond was not the only time they bought Elmore shares this year. Earlier in the year, they paid AU$0.02 per share in a AU$200k purchase. Even though the purchase was made at a significantly lower price than the recent price (AU$0.025), we still think insider buying is a positive. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

Happily, we note that in the last year insiders paid AU$436k for 20.00m shares. But they sold 900.00k shares for AU$36k. In the last twelve months there was more buying than selling by Elmore insiders. You can see a visual depiction of insider transactions (by companies and 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!

insider-trading-volume
insider-trading-volume

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).

Does Elmore Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Elmore insiders own about AU$4.4m worth of shares. That equates to 16% of the company. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Does This Data Suggest About Elmore Insiders?

It is good to see the recent insider purchase. And the longer term insider transactions also give us confidence. But we don't feel the same about the fact the company is making losses. Insiders likely see value in Elmore shares, given these transactions (along with notable insider ownership of the company). So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. To that end, you should learn about the 3 warning signs we've spotted with Elmore (including 2 which are concerning).

But note: Elmore 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.

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.

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