We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sell Ingenia Communities Group (ASX:INA), you may well want to know whether insiders have been buying or selling.
Do Insider Transactions Matter?
It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, most countries require that the company discloses such transactions to the market.
Insider transactions are not the most important thing when it comes to long-term investing. But it is perfectly logical to keep tabs on what insiders are doing. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.
The Last 12 Months Of Insider Transactions At Ingenia Communities Group
The CEO, MD & Director, Simon Owen, made the biggest insider sale in the last 12 months. That single transaction was for AU$175k worth of shares at a price of AU$3.93 each. So it's clear an insider wanted to take some cash off the table, even below the current price of AU$4.95. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. It is worth noting that this sale was only 3.2% of Simon Owen's holding. Simon Owen was the only individual insider to sell shares in the last twelve months.
In the last twelve months insiders purchased 147.84k shares for AU$523k. But insiders sold 44420 shares worth AU$175k. In total, Ingenia Communities Group insiders bought more than they sold over the last year. You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Ingenia Communities Group is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Ingenia Communities Group Insiders Bought Stock Recently
There has been significantly more insider buying, than selling, at Ingenia Communities Group, over the last three months. In total, five insiders bought AU$442k worth of shares in that time. But CEO, MD & Director Simon Owen sold shares worth AU$175k. We think insiders may be optimistic about the future, since insiders have been net buyers of shares.
For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. Ingenia Communities Group insiders own about AU$15m worth of shares. That equates to 1.1% 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 Ingenia Communities Group Insiders?
It is good to see recent purchasing. And an analysis of the transactions over the last year also gives us confidence. When combined with notable insider ownership, these factors suggest Ingenia Communities Group insiders are well aligned, and that they may think the share price is too low. Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for Ingenia Communities Group.
But note: Ingenia Communities Group 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 firstname.lastname@example.org. 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.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.