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 Blackwall Property Trust (ASX:BWR), you may well want to know whether insiders have been buying or selling.
Do Insider Transactions Matter?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, rules govern insider transactions, and certain disclosures are required.
We don't think shareholders should simply follow insider transactions. But it is perfectly logical to keep tabs on what insiders are doing. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.
The Last 12 Months Of Insider Transactions At Blackwall Property Trust
insider J. R. Tresidder made the biggest insider purchase in the last 12 months. That single transaction was for AU$2.1m worth of shares at a price of AU$1.31 each. That means that even when the share price was higher than AU$1.28 (the recent price), an insider wanted to purchase shares. It's very possible they regret the purchase, but it's more likely they are bullish about the company. We always take careful note of the price insiders pay when purchasing shares. 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.
While Blackwall Property Trust insiders bought shares last year, they didn't sell. You can see the insider transactions (by individuals) 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!
Blackwall Property Trust is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Insiders at Blackwall Property Trust Have Bought Stock Recently
Over the last quarter, Blackwall Property Trust insiders have spent a meaningful amount on shares. Overall, four insiders shelled out AU$5.6m for shares in the company -- and none sold. This could be interpreted as suggesting a positive outlook.
Insider Ownership of Blackwall Property Trust
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 appears that Blackwall Property Trust insiders own 32% of the company, worth about AU$61m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
So What Do The Blackwall Property Trust Insider Transactions Indicate?
It is good to see recent purchasing. And an analysis of the transactions over the last year also gives us confidence. Insiders likely see value in Blackwall Property Trust shares, given these transactions (along with notable insider ownership of the company). Along with insider transactions, I recommend checking if Blackwall Property Trust is growing revenue. This free chart of historic revenue and earnings should make that easy.
Of course Blackwall Property Trust 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.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at email@example.com. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.