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It is not uncommon to see companies perform well in the years after insiders buy shares. 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 shareholders might well want to know whether insiders have been buying or selling shares in Milestone Scientific Inc. (NYSEMKT:MLSS).
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 on the market. However, most countries require that the company discloses such transactions to the market.
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. For example, a Harvard University study found that ‘insider purchases earn abnormal returns of more than 6% per year.’
Milestone Scientific Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider purchase was by Founder Leonard Osser for US$100k worth of shares, at about US$0.35 per share. So it’s clear an insider wanted to buy, at around the current price. That means they have been optimistic about the company in the past, though they may have changed their mind. We generally consider it a positive if insiders have been buying on market, even if the share price has increased a bit since then.
Happily, we note that in the last year insiders bought 300.00k shares for a total of US$105k. Overall, Milestone Scientific insiders were net buyers last year. The average buy price was around US$0.35. Although they bought at below the recent price of US$0.36 per share, it is good to see that insiders are willing to invest in the company. You can see the insider transactions (by individuals) over the last year depicted in the chart below. 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 Milestone Scientific Have Bought Stock Recently
It’s good to see that Milestone Scientific insiders have made notable investments in the company’s shares. Not only was there no selling that we can see, but they collectively bought US$105k worth of shares. This is a positive in our book as it implies some confidence.
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. A high insider ownership often makes company leadership more mindful of shareholder interests. Milestone Scientific insiders own about US$3.8m worth of shares. That equates to 27% 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.
What Might The Insider Transactions At Milestone Scientific Tell Us?
It is good to see recent purchasing. And an analysis of the transactions over the last year also gives us confidence. But on the other hand, the company made a loss last year, which makes us a little cautious. Given that insiders also own a fair bit of Milestone Scientific we think they are probably pretty confident of a bright future. Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for Milestone Scientific.
But note: Milestone Scientific 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.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at firstname.lastname@example.org.