Whilst it may not be a huge deal, we thought it was good to see that the Silverlake Axis Ltd (SGX:5CP) Head of Strategic Digital Value Program, Yong Sin Kwong, recently bought S$57k worth of stock, for S$0.23 per share. However, it only increased their shares held by 1.2%, and it wasn't a huge purchase by absolute value, either.
Silverlake Axis Insider Transactions Over The Last Year
In fact, the recent purchase by Head of Strategic Digital Value Program Yong Sin Kwong was not their only acquisition of Silverlake Axis shares this year. Earlier in the year, they paid S$0.29 per share in a S$89k purchase. That means that even when the share price was higher than S$0.21 (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. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.
In the last twelve months insiders purchased 1.25m shares for S$413k. On the other hand they divested 250000 shares, for S$84k. In the last twelve months there was more buying than selling by Silverlake Axis insiders. The average buy price was around S$0.33. These transactions suggest that insiders have considered the current price attractive. You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Silverlake Axis 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. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 3.6% of Silverlake Axis shares, worth about S$20m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
So What Do The Silverlake Axis Insider Transactions Indicate?
It's certainly positive to see the recent insider purchases. And the longer term insider transactions also give us confidence. When combined with notable insider ownership, these factors suggest Silverlake Axis insiders are well aligned, and that they may think the share price is too low. 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. In terms of investment risks, we've identified 2 warning signs with Silverlake Axis and understanding them should be part of your investment process.
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, but not derivative transactions.
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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. 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. Thank you for reading.