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Non-Executive Director Ya Zhang Just Bought A Handful Of Shares In Fortescue Metals Group Limited (ASX:FMG)

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·3 min read
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Potential Fortescue Metals Group Limited (ASX:FMG) shareholders may wish to note that the Non-Executive Director, Ya Zhang, recently bought AU$230k worth of stock, paying AU$19.14 for each share. Although the purchase is not a big one, by either a percentage standpoint or absolute value, it can be seen as a good sign.

See our latest analysis for Fortescue Metals Group

The Last 12 Months Of Insider Transactions At Fortescue Metals Group

In the last twelve months, the biggest single purchase by an insider was when Founder & Chairman of the Board John Andrew Forrest bought AU$243m worth of shares at a price of AU$10.98 per share. Even though the purchase was made at a significantly lower price than the recent price (AU$18.87), we still think insider buying is a positive. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.

Fortescue Metals Group insiders may have bought shares in the last year, but they didn't sell any. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

insider-trading-volume
insider-trading-volume

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 Fortescue Metals Group

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. It's great to see that Fortescue Metals Group insiders own 0.3% of the company, worth about AU$190m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

What Might The Insider Transactions At Fortescue Metals Group Tell Us?

It's certainly positive to see the recent insider purchase. And the longer term insider transactions also give us confidence. Along with the high insider ownership, this analysis suggests that insiders are quite bullish about Fortescue Metals Group. One for the watchlist, at least! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. To that end, you should learn about the 3 warning signs we've spotted with Fortescue Metals Group (including 1 which doesn't sit too well with us).

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.

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