Multiple insiders bought Latitude Group Holdings Limited (ASX:LFS) stock earlier this year, a positive sign for shareholders
Usually, when one insider buys stock, it might not be a monumental event. But when multiple insiders are buying like they did in the case of Latitude Group Holdings Limited (ASX:LFS), that sends out a positive message to the company's shareholders.
While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
View our latest analysis for Latitude Group Holdings
Latitude Group Holdings Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when MD, CEO & Director A. Fahour bought AU$400k worth of shares at a price of AU$2.00 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being AU$1.32). 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. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.
Latitude Group Holdings insiders may have bought shares in the last year, but they didn't sell any. Their average price was about AU$1.79. I'd consider this a positive as it suggests insiders see value at around the current price. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Latitude Group Holdings 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.
Insiders At Latitude Group Holdings Have Bought Stock Recently
Over the last quarter, Latitude Group Holdings insiders have spent a meaningful amount on shares. Specifically, Non-Executive Director Julie Raffe bought AU$101k worth of shares in that time, and we didn't record any sales whatsoever. This could be interpreted as suggesting a positive outlook.
Insider Ownership
Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 3.1% of Latitude Group Holdings shares, worth about AU$43m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
What Might The Insider Transactions At Latitude Group Holdings Tell Us?
It is good to see the recent insider purchase. We also take confidence from the longer term picture of insider transactions. Given that insiders also own a fair bit of Latitude Group Holdings we think they are probably pretty confident of a bright future. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. Our analysis shows 2 warning signs for Latitude Group Holdings (1 makes us a bit uncomfortable!) and we strongly recommend you look at these before investing.
Of course Latitude Group Holdings may not be the best stock to buy. So you may wish to see this free collection of high quality 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.
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