Stelar Metals Limited (ASX:SLB) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 16%, resulting in a AU$2.6m rise in the company's market capitalisation. As a result, their original purchase of AU$193k worth of stock is now worth AU$333k.
Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.
See our latest analysis for Stelar Metals
The Last 12 Months Of Insider Transactions At Stelar Metals
In the last twelve months, the biggest single purchase by an insider was when Non-Executive Chair Stephen Biggins bought AU$106k worth of shares at a price of AU$0.23 per share. Even though the purchase was made at a significantly lower price than the recent price (AU$0.37), we still think insider buying is a positive. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.
While Stelar Metals 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. By clicking on the graph below, you can see the precise details of each insider transaction!
Stelar Metals is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Does Stelar Metals Boast High Insider Ownership?
For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. Stelar Metals insiders own about AU$6.1m worth of shares. That equates to 32% of the company. 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 Stelar Metals Tell Us?
The fact that there have been no Stelar Metals 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 Stelar Metals insiders are doubting the company, and they do own shares. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. To help with this, we've discovered 6 warning signs (2 are a bit unpleasant!) that you ought to be aware of before buying any shares in Stelar Metals.