Insider Spends US$249k Buying More Shares In Lucapa Diamond
Investors who take an interest in Lucapa Diamond Company Limited (ASX:LOM) should definitely note that the Non-Executive Director, Ross Stanley, recently paid AU$0.04 per share to buy AU$249k worth of the stock. While that's a very decent purchase to our minds, it was proportionally a bit modest, boosting their holding by just 7.7%.
See our latest analysis for Lucapa Diamond
Lucapa Diamond Insider Transactions Over The Last Year
Notably, that recent purchase by Ross Stanley is the biggest insider purchase of Lucapa Diamond shares that we've seen in the last year. That means that an insider was happy to buy shares at around the current price of AU$0.042. Of course they may have changed their mind. But this suggests they are optimistic. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. Happily, the Lucapa Diamond insider decided to buy shares at close to current prices. The only individual insider to buy over the last year was Ross Stanley.
The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
Insider Ownership
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. We usually like to see fairly high levels of insider ownership. Our data indicates that Lucapa Diamond insiders own about AU$6.1m worth of shares (which is 10% of the company). However, it's possible that insiders might have an indirect interest through a more complex structure. We do generally prefer see higher levels of insider ownership.
So What Does This Data Suggest About Lucapa Diamond Insiders?
It is good to see the recent insider purchase. And an analysis of the transactions over the last year also gives us confidence. But on the other hand, the company made a loss during the last year, which makes us a little cautious. While the overall levels of insider ownership are below what we'd like to see, the history of transactions imply that Lucapa Diamond insiders are reasonably well aligned, and optimistic for the future. 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. Case in point: We've spotted 3 warning signs for Lucapa Diamond you should be aware of, and 2 of these can't be ignored.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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.
