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Had insiders known Prime Financial Group Limited (ASX:PFG) would hit AU$32m they might have invested more last year

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Insiders who bought Prime Financial Group Limited (ASX:PFG) stock in the last 12 months were richly rewarded last week. The company's market value increased by AU$5.7m as a result of the stock's 21% gain over the same period. As a result, the stock they originally bought for AU$51k is now worth AU$63k.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.

See our latest analysis for Prime Financial Group

Prime Financial Group Insider Transactions Over The Last Year

Notably, that recent purchase by Brett Gorman is the biggest insider purchase of Prime Financial Group shares that we've seen in the last year. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of AU$0.17. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

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

Prime Financial Group 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.

Insider Ownership

Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Prime Financial Group insiders own about AU$8.7m worth of shares. That equates to 27% of the company. 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 Does This Data Suggest About Prime Financial Group Insiders?

The recent insider purchase is heartening. And an analysis of the transactions over the last year also gives us confidence. Insiders likely see value in Prime Financial Group shares, given these transactions (along with notable insider ownership of the company). So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. In terms of investment risks, we've identified 4 warning signs with Prime Financial Group and understanding these should be part of your investment process.

Of course Prime Financial Group 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.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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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