Whilst it may not be a huge deal, we thought it was good to see that the Vicinity Centres (ASX:VCX) Independent Chairman of the Board, Trevor Gerber, recently bought AU$68k worth of stock, for AU$1.35 per share. That purchase might not be huge but it did increase their holding by 29%.
The Last 12 Months Of Insider Transactions At Vicinity Centres
Notably, that recent purchase by Independent Chairman of the Board Trevor Gerber was not the only time they bought Vicinity Centres shares this year. They previously made an even bigger purchase of AU$112k worth of shares at a price of AU$2.24 per share. That means that even when the share price was higher than AU$1.42 (the recent price), an insider wanted to purchase shares. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. To us, it's very important to consider the price insiders pay for shares is very important. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.
While Vicinity Centres insiders bought shares during the last year, they didn't sell. Their average price was about AU$1.67. This is nice to see since it implies that insiders might see value around current prices. You can see the insider transactions (by companies and 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!
Vicinity Centres 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.
Does Vicinity Centres Boast High Insider Ownership?
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. Vicinity Centres insiders own about AU$22m worth of shares. That equates to 0.3% 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.
What Might The Insider Transactions At Vicinity Centres Tell Us?
It is good to see recent purchasing. And an analysis of the transactions over the last year also gives us confidence. But we don't feel the same about the fact the company is making losses. Insiders likely see value in Vicinity Centres shares, given these transactions (along with notable insider ownership of the company). In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Vicinity Centres. While conducting our analysis, we found that Vicinity Centres has 2 warning signs and it would be unwise to ignore them.
But note: Vicinity Centres 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.
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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