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Acumentis Group Limited (ASX:ACU) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 17%, resulting in a AU$2.7m rise in the company's market capitalisation, translating to a gain of 22% on their initial investment. As a result, their original purchase of AU$217.4k worth of stock is now worth AU$264.7k.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.
See our latest analysis for Acumentis Group
The Last 12 Months Of Insider Transactions At Acumentis Group
The insider Noel Kagi made the biggest insider purchase in the last 12 months. That single transaction was for AU$203k worth of shares at a price of AU$0.073 each. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of AU$0.084. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.
While Acumentis Group 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!
Acumentis Group 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
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. We usually like to see fairly high levels of insider ownership. Insiders own 30% of Acumentis Group shares, worth about AU$5.6m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
What Might The Insider Transactions At Acumentis Group Tell Us?
It doesn't really mean much that no insider has traded Acumentis Group shares in the last quarter. On a brighter note, the transactions over the last year are encouraging. Insiders own shares in Acumentis Group and we see no evidence to suggest they are worried about the future. 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 1 warning sign for Acumentis Group you should know about.