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Multiple insiders bought Hiscox Ltd (LON:HSX) stock earlier this year, a positive sign for shareholders

Usually, when one insider buys stock, it might not be a monumental event. But when multiple insiders are buying like they did in the case of Hiscox Ltd (LON:HSX), that sends out a positive message to the company's shareholders.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

Check out our latest analysis for Hiscox

The Last 12 Months Of Insider Transactions At Hiscox

The Group CEO & Executive Director Bronislaw Masojada made the biggest insider purchase in the last 12 months. That single transaction was for UK£126k worth of shares at a price of UK£8.37 each. That means that an insider was happy to buy shares at above the current price of UK£8.29. Their view may have changed since then, but at least it shows they felt optimistic at the time. We always take careful note of the price insiders pay when purchasing shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.

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Happily, we note that in the last year insiders paid UK£231k for 27.29k shares. But they sold 870.00 shares for UK£7.5k. Overall, Hiscox insiders were net buyers during the last year. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

insider-trading-volume
insider-trading-volume

Hiscox is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Hiscox Insiders Bought Stock Recently

Over the last quarter, Hiscox insiders have spent a meaningful amount on shares. Overall, three insiders shelled out UK£190k for shares in the company -- and none sold. That shows some optimism about the company's future.

Insider Ownership of Hiscox

Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. It appears that Hiscox insiders own 1.3% of the company, worth about UK£38m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Does This Data Suggest About Hiscox Insiders?

The recent insider purchases are heartening. We also take confidence from the longer term picture of insider transactions. But on the other hand, the company made a loss during the last year, which makes us a little cautious. Given that insiders also own a fair bit of Hiscox we think they are probably pretty confident of a bright future. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. While conducting our analysis, we found that Hiscox has 1 warning sign and it would be unwise to ignore it.

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.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.