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When a single insider purchases stock, it is typically not a major deal. However, when multiple insiders purchase stock, like in Energean plc's (LON:ENOG) instance, it's good news for shareholders.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.
Energean Insider Transactions Over The Last Year
The CEO & Director Mathaios Rigas made the biggest insider purchase in the last 12 months. That single transaction was for UK£340k worth of shares at a price of UK£8.50 each. That means that an insider was happy to buy shares at above the current price of UK£8.42. 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. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.
In the last twelve months insiders purchased 53.55k shares for UK£465k. On the other hand they divested 5.55k shares, for UK£55k. In the last twelve months there was more buying than selling by Energean insiders. 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!
See our latest analysis for Energean
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.
Does Energean Boast High Insider Ownership?
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. Energean insiders own 11% of the company, currently worth about UK£164m based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
So What Do The Energean Insider Transactions Indicate?
The fact that there have been no Energean insider transactions recently certainly doesn't bother us. On a brighter note, the transactions over the last year are encouraging. Judging from their transactions, and high insider ownership, Energean insiders feel good about the company's 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. Our analysis shows 2 warning signs for Energean (1 doesn't sit too well with us!) and we strongly recommend you look at them before investing.