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Some of the losses seen by insiders who purchased AU$467.0k worth of Elementos Limited (ASX:ELT) shares over the past year were recovered after the stock increased by 44% over the past week. However, the purchase is proving to be a costly gamble, since losses made by insiders have totalled AU$49k since the time of purchase.
While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.
Elementos Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when Non-Executive Chairman Andrew Greig bought AU$419k worth of shares at a price of AU$0.095 per share. That means that an insider was happy to buy shares at above the current price of AU$0.085. It's very possible they regret the purchase, but it's more likely they are bullish about the company. We always take careful note of the price insiders pay when purchasing shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.
Elementos insiders may have bought shares in the last year, but they didn't sell any. 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!
Check out our latest analysis for Elementos
Elementos 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.
Insider Ownership Of Elementos
For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. It appears that Elementos insiders own 26% of the company, worth about AU$5.2m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
What Might The Insider Transactions At Elementos Tell Us?
The fact that there have been no Elementos insider transactions recently certainly doesn't bother us. But insiders have shown more of an appetite for the stock, over the last year. Overall we don't see anything to make us think Elementos insiders are doubting the company, and they do own shares. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Every company has risks, and we've spotted 5 warning signs for Elementos (of which 2 are potentially serious!) you should know about.