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Insiders who purchased AU$295.8k worth of Holista Colltech Limited (ASX:HCT) shares over the past year recouped some of their losses after price gained 30% last week. However, the purchase is proving to be a costly gamble, since losses made by insiders have totalled AU$158k since the time of purchase.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.
View our latest analysis for Holista Colltech
Holista Colltech Insider Transactions Over The Last Year
In fact, the recent purchase by Anthony Ramage was the biggest purchase of Holista Colltech shares made by an insider individual in the last twelve months, according to our records. That means that even when the share price was higher than AU$0.013 (the recent price), an insider wanted to purchase shares. It's very possible they regret the purchase, but it's more likely they are bullish about the company. In our view, the price an insider pays for shares is very important. Generally speaking, it catches our eye when an insider has purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price. Anthony Ramage was the only individual insider to buy during the last year.
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!
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).
Does Holista Colltech Boast High Insider Ownership?
Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Holista Colltech insiders own 46% of the company, currently worth about AU$1.7m based on the recent share price. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
So What Do The Holista Colltech Insider Transactions Indicate?
The recent insider purchase is heartening. And an analysis of the transactions over the last year also gives us confidence. But we don't feel the same about the fact the company is making losses. Along with the high insider ownership, this analysis suggests that insiders are quite bullish about Holista Colltech. That's what I like to see! 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've found that Holista Colltech has 6 warning signs (5 make us uncomfortable!) that deserve your attention before going any further with your analysis.