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Whilst it may not be a huge deal, we thought it was good to see that the Candy Club Holdings Limited (ASX:CLB) Non-Executive Chairman, James Baillieu, recently bought AU$126k worth of stock, for AU$0.099 per share. Although the purchase is not a big one, increasing their shareholding by only 2.1%, it can be interpreted as a good sign.
The Last 12 Months Of Insider Transactions At Candy Club Holdings
In fact, the recent purchase by Non-Executive Chairman James Baillieu was not their only acquisition of Candy Club Holdings shares this year. Earlier in the year, they paid AU$0.08 per share in a AU$3.3m purchase. So it's clear an insider wanted to buy, at around the current price, which is AU$0.095. 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. We do always like to see insider buying, but it is worth noting if those purchases were made at well below today's share price, as the discount to value may have narrowed with the rising price. In this case we're pleased to report that the insider purchases were made at close to current prices.
Happily, we note that in the last year insiders paid AU$3.8m for 54.46m shares. On the other hand they divested 725208 shares, for AU$59k. Overall, Candy Club Holdings insiders were net buyers during the last year. The average buy price was around AU$0.069. It is certainly positive to see that insiders have invested their own money in the company. But we must note that the investments were made at well below today's share price. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, 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.
Insider Ownership of Candy Club Holdings
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It's great to see that Candy Club Holdings insiders own 43% of the company, worth about AU$10m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
So What Do The Candy Club Holdings Insider Transactions Indicate?
It is good to see the recent insider purchase. We also take confidence from the longer term picture of insider transactions. But on the other hand, the company made a loss during the last year, which makes us a little cautious. Once you factor in the high insider ownership, it certainly seems like insiders are positive about Candy Club Holdings. One for the watchlist, at least! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Candy Club Holdings. To that end, you should learn about the 5 warning signs we've spotted with Candy Club Holdings (including 2 which are a bit unpleasant).
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.
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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. Thank you for reading.