How Many Insiders Bought RXP Services Limited (ASX:RXP) Shares?
It is not uncommon to see companies perform well in the years after insiders buy shares. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sell RXP Services Limited (ASX:RXP), you may well want to know whether insiders have been buying or selling.
Do Insider Transactions Matter?
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, such insiders must disclose their trading activities, and not trade on inside information.
We don’t think shareholders should simply follow insider transactions. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Harvard University study found that ‘insider purchases earn abnormal returns of more than 6% per year.’
Check out our latest analysis for RXP Services
RXP Services Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider purchase was by CEO, MD & Executive Director Ross Fielding for AU$97k worth of shares, at about AU$0.49 per share. So it’s clear an insider wanted to buy, even at a higher price. 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. That purchase may suggest an expectation of positive returns over the long term.
Over the last year, we can see that insiders have bought 247.62k shares worth AU$122k. In the last twelve months there was more buying than selling by RXP Services insiders. The average buy price was around AU$0.49. This is nice to see since it implies that insiders might see value around current prices (around AU$0.47). You can see the insider transactions 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!
I will like RXP Services better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
Does RXP Services Boast High Insider Ownership?
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. RXP Services insiders own 6.6% of the company, currently worth about AU$4.9m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
What Might The Insider Transactions At RXP Services Tell Us?
It doesn’t really mean much that no insider has traded RXP Services shares in the last quarter. On a brighter note, the transactions over the last year are encouraging. While we have no worries about the insider transactions, we’d be more comfortable if they owned more RXP Services stock. Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for RXP Services.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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 editorial-team@simplywallst.com.
