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Even if it's not a huge purchase, we think it was good to see that Nicholas Wiles, the CEO, Member of Executive Board & Executive Director of PayPoint plc (LON:PAY) recently shelled out UK£62k to buy stock, at UK£6.17 per share. While we're hesitant to get too excited about a purchase of that size, we do note it increased their holding by a solid 17%.
Check out our latest analysis for PayPoint
PayPoint Insider Transactions Over The Last Year
In fact, the recent purchase by CEO, Member of Executive Board & Executive Director Nicholas Wiles was not their only acquisition of PayPoint shares this year. They previously made an even bigger purchase of UK£95k worth of shares at a price of UK£6.36 per share. That means that even when the share price was higher than UK£6.32 (the recent price), an insider wanted to purchase shares. 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. In our view, the price an insider pays for shares is very important. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.
While PayPoint insiders bought shares during the last year, they didn't sell. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
PayPoint is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Does PayPoint 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. We usually like to see fairly high levels of insider ownership. Our data suggests PayPoint insiders own 0.3% of the company, worth about UK£1.3m. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. We prefer to see high levels of insider ownership.
What Might The Insider Transactions At PayPoint Tell Us?
It's certainly positive to see the recent insider purchases. And an analysis of the transactions over the last year also gives us confidence. On this analysis the only slight negative we see is the fairly low (overall) insider ownership; their transactions suggest that they are quite positive on PayPoint stock. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. At Simply Wall St, we found 3 warning signs for PayPoint that deserve your attention before buying any shares.