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It is usually uneventful when a single insider buys stock. However, When quite a few insiders buy shares, as it happened in Ionik Corporation's (CVE:INIK) case, it's fantastic news for shareholders.
Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.
See our latest analysis for Ionik
Ionik Insider Transactions Over The Last Year
The President Kevin Ferrell made the biggest insider purchase in the last 12 months. That single transaction was for CA$399k worth of shares at a price of CA$0.086 each. Even though the purchase was made at a significantly lower price than the recent price (CA$0.10), we still think insider buying is a positive. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.
Happily, we note that in the last year insiders paid CA$939k for 10.64m shares. On the other hand they divested 6.49m shares, for CA$558k. In total, Ionik insiders bought more than they sold over 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!
Ionik is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.
Insiders At Ionik Have Bought Stock Recently
At Ionik,over the last quarter, we have observed quite a lot more insider buying than insider selling. In fact, three insiders bought CA$939k worth of shares. But insiders only sold shares worth CA$558k. Insiders have spent more buying shares than they have selling, so on balance we think they are are probably optimistic.
Insider Ownership Of Ionik
Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. It appears that Ionik insiders own 32% of the company, worth about CA$9.8m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
So What Do The Ionik Insider Transactions Indicate?
It is good to see recent purchasing. And an analysis of the transactions over the last year also gives us confidence. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. Insiders likely see value in Ionik 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 Ionik. Case in point: We've spotted 5 warning signs for Ionik you should be aware of, and 1 of them is significant.