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We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. On the other hand, we'd be remiss not to mention that insider sales have been known to precede tough periods for a business. So we'll take a look at whether insiders have been buying or selling shares in AssetOwl Limited (ASX:AO1).
What Is Insider Buying?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock in the company. However, rules govern insider transactions, and certain disclosures are required.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. 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'.
AssetOwl Insider Transactions Over The Last Year
In fact, the recent purchase by insider Andrew Lane was not their only acquisition of AssetOwl shares this year. They previously made an even bigger purchase of AU$66k worth of shares at a price of AU$0.008 per share. That means that even when the share price was higher than AU$0.006 (the recent price), an insider wanted to purchase shares. Their view may have changed since then, but at least it shows they felt optimistic at the time. In our view, the price an insider pays for shares is very important. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels. Notably Andrew Lane was also the biggest seller.
In the last twelve months insiders purchased 15.29m shares for AU$101k. But insiders sold 8.29m shares worth AU$66k. In the last twelve months there was more buying than selling by AssetOwl insiders. Their average price was about AU$0.0066. This is nice to see since it implies that insiders might see value around current prices. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
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.
Insiders at AssetOwl Have Bought Stock Recently
There was some insider buying at AssetOwl over the last quarter. Insiders purchased AU$35k worth of shares in that period. We like it when there are only buyers, and no sellers. However, in this case the amount invested recently is quite small.
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. From our data, it seems that AssetOwl insiders own 10% of the company, worth about AU$495k. However, it's possible that insiders might have an indirect interest through a more complex structure. Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!
What Might The Insider Transactions At AssetOwl Tell Us?
We note a that there has been a bit of insider buying recently (but no selling). That said, the purchases were not large. However, our analysis of transactions over the last year is heartening. While we have no worries about the insider transactions, we'd be more comfortable if they owned more AssetOwl stock. 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 5 warning signs for AssetOwl you should be aware of, and 4 of these shouldn'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.
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.
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