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Non-Executive Director Peter Miller Just Bought 25% More Shares In HGL Limited (ASX:HNG)

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·3 min read
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Potential HGL Limited (ASX:HNG) shareholders may wish to note that the Non-Executive Director, Peter Miller, recently bought AU$566k worth of stock, paying AU$0.13 for each share. That's a very solid buy in our book, and increased their holding by a noteworthy 25%.

See our latest analysis for HGL

HGL Insider Transactions Over The Last Year

In fact, the recent purchase by Non-Executive Director Peter Miller was not their only acquisition of HGL shares this year. They previously made an even bigger purchase of AU$1.0m worth of shares at a price of AU$0.20 per share. That means that even when the share price was higher than AU$0.15 (the recent price), an insider wanted to purchase shares. 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. To us, it's very important to consider the price insiders pay for shares is very important. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.

Over the last year, we can see that insiders have bought 15.15m shares worth AU$2.4m. On the other hand they divested 43.63k shares, for AU$9.9k. In total, HGL insiders bought more than they sold over the last year. The average buy price was around AU$0.16. I'd consider this a positive as it suggests insiders see value at around the current price. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

insider-trading-volume
insider-trading-volume

HGL is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Does HGL Boast High Insider Ownership?

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 30% of HGL shares, worth about AU$4.5m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Does This Data Suggest About HGL Insiders?

The recent insider purchases are heartening. We also take confidence from the longer term picture of insider transactions. But we don't feel the same about the fact the company is making losses. Given that insiders also own a fair bit of HGL 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. Case in point: We've spotted 3 warning signs for HGL you should be aware of, and 1 of them is significant.

But note: HGL 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.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.