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Generally, when a single insider buys stock, it is usually not a big deal. However, when several insiders are buying, like in the case of Alphawave IP Group plc (LON:AWE), it sends a favourable message to the company's shareholders.
While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
See our latest analysis for Alphawave IP Group
Alphawave IP Group Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider purchase was by Chief Financial Officer Rahul Mathur for UK£117k worth of shares, at about UK£1.17 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of UK£1.51. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.
Over the last year, we can see that insiders have bought 140.70k shares worth UK£176k. But insiders sold 48.78k shares worth UK£57k. In the last twelve months there was more buying than selling by Alphawave IP Group insiders. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).
Alphawave IP Group Insiders Bought Stock Recently
Over the last three months, we've seen significant insider buying at Alphawave IP Group. Specifically, Chief Financial Officer Rahul Mathur bought UK£117k worth of shares in that time, and we didn't record any sales whatsoever. This is a positive in our book as it implies some confidence.
Insider Ownership Of Alphawave IP Group
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. Alphawave IP Group insiders own 56% of the company, currently worth about UK£618m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
So What Do The Alphawave IP Group Insider Transactions Indicate?
The recent insider purchase is heartening. We also take confidence from the longer term picture of insider transactions. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. Once you factor in the high insider ownership, it certainly seems like insiders are positive about Alphawave IP Group. Nice! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. At Simply Wall St, we found 2 warning signs for Alphawave IP Group that deserve your attention before buying any shares.