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IperionX Limited (ASX:IPX) shareholders (or potential shareholders) will be happy to see that the Executive Chairman, Todd Hannigan, recently bought a whopping AU$6.1m worth of stock, at a price of AU$1.91. Not only is that a big swing, but it increased their holding size by 18%, which is definitely great to see.
Check out our latest analysis for IperionX
The Last 12 Months Of Insider Transactions At IperionX
In fact, the recent purchase by Todd Hannigan was the biggest purchase of IperionX shares made by an insider individual in the last twelve months, according to our records. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of AU$2.20. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.
IperionX insiders may have bought shares in the last year, but they didn't sell any. 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!
IperionX 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.
Does IperionX 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. A high insider ownership often makes company leadership more mindful of shareholder interests. IperionX insiders own about AU$97m worth of shares. That equates to 17% of the company. 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 IperionX Insider Transactions Indicate?
The recent insider purchases are 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. When combined with notable insider ownership, these factors suggest IperionX insiders are well aligned, and that they may think the share price is too low. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Our analysis shows 2 warning signs for IperionX (1 doesn't sit too well with us!) and we strongly recommend you look at them before investing.