Pleasing Signs As A Number Of Insiders Buy Astute Metals Stock
It is usually uneventful when a single insider buys stock. However, When quite a few insiders buy shares, as it happened in Astute Metals NL's (ASX:ASE) case, it's fantastic news for shareholders.
While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.
Check out our latest analysis for Astute Metals
The Last 12 Months Of Insider Transactions At Astute Metals
The Non-Executive Chairman Anthony Leibowitz made the biggest insider purchase in the last 12 months. That single transaction was for AU$350k worth of shares at a price of AU$0.053 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being AU$0.028). 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. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.
While Astute Metals insiders bought shares during the last year, they didn't sell. Their average price was about AU$0.044. This is nice to see since it implies that insiders might see value around current prices. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Astute Metals is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.
Astute Metals Insiders Bought Stock Recently
We saw some Astute Metals insider buying shares in the last three months. Non-Executive Chairman Anthony Leibowitz purchased AU$57k worth of shares in that period. It's good to see the insider buying, as well as the lack of recent sellers. But in this case the amount purchased means the recent transaction may not be very meaningful on its own.
Insider Ownership Of Astute Metals
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. Insiders own 34% of Astute Metals shares, worth about AU$4.1m. 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 Astute Metals Tell Us?
The recent insider purchase is heartening. And an analysis of the transactions over the last year also gives us confidence. But on the other hand, the company made a loss during the last year, which makes us a little cautious. Insiders likely see value in Astute Metals shares, given these transactions (along with notable insider ownership of the company). 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. At Simply Wall St, we've found that Astute Metals has 6 warning signs (5 are significant!) that deserve your attention before going any further with your analysis.
Of course Astute Metals 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 of direct interests only, but not derivative transactions or indirect interests.
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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@simplywallst.com