Whilst it may not be a huge deal, we thought it was good to see that the 20 Microns Limited (NSE:20MICRONS) Non-Executive Independent Director, Ajay Ranka, recently bought ₹3.0m worth of stock, for ₹39.58 per share. Even though that isn't a massive buy, it did increase their holding by 110%, which is a arguably a good sign.
The Last 12 Months Of Insider Transactions At 20 Microns
In fact, the recent purchase by Ajay Ranka was the biggest purchase of 20 Microns shares made by an insider individual in the last twelve months, according to our records. That means that an insider was happy to buy shares at above the current price of ₹37.90. Their view may have changed since then, but at least it shows they felt optimistic at the time. In our view, the price an insider pays for shares is very important. As a general rule, we feel more positive about a stock when an insider has bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price. Ajay Ranka was the only individual insider to buy shares in the last twelve months.
Ajay Ranka purchased 143041 shares over the year. The average price per share was ₹37.72. You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
20 Microns is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. 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 20 Microns insiders own 31% of the company, worth about ₹414m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
What Might The Insider Transactions At 20 Microns Tell Us?
The recent insider purchase is heartening. And the longer term insider transactions also give us confidence. Once you factor in the high insider ownership, it certainly seems like insiders are positive about 20 Microns. Nice! I like to dive deeper into how a company has performed in the past. You can access this interactive graph of past earnings, revenue and cash flow for free.
But note: 20 Microns 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.
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 firstname.lastname@example.org. 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.