Investors who take an interest in Incitec Pivot Limited (ASX:IPL) should definitely note that the MD, CEO & Executive Director, Jeanne Johns, recently paid AU$1.98 per share to buy AU$199k worth of the stock. That's a very decent purchase to our minds and it grew their holding by a solid 34%.
Incitec Pivot Insider Transactions Over The Last Year
Notably, that recent purchase by MD, CEO & Executive Director Jeanne Johns was not the only time they bought Incitec Pivot shares this year. Earlier in the year, they paid AU$3.17 per share in a AU$499k purchase. So it's clear an insider wanted to buy, even at a higher price than the current share price (being AU$2.00). It's very possible they regret the purchase, but it's more likely they are bullish about the company. In our view, the price an insider pays for shares is very important. It is encouraging to see an insider paid above the current price for shares, as it suggests they saw value, even at higher levels. Jeanne Johns was the only individual insider to buy during the last year.
Jeanne Johns bought a total of 258.87k shares over the year at an average price of AU$2.70. The chart below shows insider transactions (by individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Incitec Pivot is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
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. From looking at our data, insiders own AU$3.5m worth of Incitec Pivot stock, about 0.1% of the company. We consider this fairly low insider ownership.
What Might The Insider Transactions At Incitec Pivot Tell Us?
The recent insider purchase is heartening. We also take confidence from the longer term picture of insider transactions. While the overall levels of insider ownership are below what we'd like to see, the history of transactions imply that Incitec Pivot insiders are reasonably well aligned, and optimistic for the 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. To help with this, we've discovered 3 warning signs (1 is concerning!) that you ought to be aware of before buying any shares in Incitec Pivot.
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.