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Even if it's not a huge purchase, we think it was good to see that Simon Taylor, the MD & CEO of Stellar Resources Limited (ASX:SRZ) recently shelled out AU$103k to buy stock, at AU$0.015 per share. That purchase might not be huge but it did increase their holding by 27%.
View our latest analysis for Stellar Resources
Stellar Resources Insider Transactions Over The Last Year
In fact, the recent purchase by Simon Taylor was the biggest purchase of Stellar Resources shares made by an insider individual in the last twelve months, according to our records. So it's clear an insider wanted to buy, at around the current price, which is AU$0.016. Of course they may have changed their mind. But this suggests they are optimistic. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. Happily, the Stellar Resources insiders decided to buy shares at close to current prices.
Stellar Resources insiders may have bought shares in the last year, but they didn't sell any. They paid about AU$0.013 on average. It is certainly positive to see that insiders have invested their own money in the company. However, we do note that they were buying at significantly lower prices than today's share price. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
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.
Insider Ownership Of Stellar Resources
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. From looking at our data, insiders own AU$1.6m worth of Stellar Resources stock, about 4.9% of the company. But they may have an indirect interest through a corporate structure that we haven't picked up on. We prefer to see high levels of insider ownership.
So What Does This Data Suggest About Stellar Resources Insiders?
It is good to see the recent insider purchase. We also take confidence from the longer term picture of insider transactions. But on the other hand, the company made a loss during the last year, which makes us a little cautious. While the overall levels of insider ownership are below what we'd like to see, the history of transactions imply that Stellar Resources insiders are reasonably well aligned, and optimistic for the future. While it's good to be aware of 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. To that end, you should learn about the 4 warning signs we've spotted with Stellar Resources (including 2 which are concerning).