In This Article:
Insiders who bought AU$4.58m worth of NextEd Group Limited (ASX:NXD) stock in the last year recovered part of their losses as the stock rose by 48% last week. The purchase, however, has proven to be a pricey bet, with losses currently totalling AU$3.4m.
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.
View our latest analysis for NextEd Group
NextEd Group Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider purchase was by insider Angus Johnson for AU$4.5m worth of shares, at about AU$1.19 per share. That means that even when the share price was higher than AU$0.17 (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. We always take careful note of the price insiders pay when purchasing shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.
While NextEd Group insiders bought shares during the last year, they didn't sell. The average buy price was around AU$0.68. These transactions suggest that insiders have considered the current price attractive. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
NextEd 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 Of NextEd Group
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. Our data indicates that NextEd Group insiders own about AU$5.0m worth of shares (which is 13% of the company). We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. We do generally prefer see higher levels of insider ownership.
What Might The Insider Transactions At NextEd Group Tell Us?
There haven't been any insider transactions in the last three months -- that doesn't mean much. But insiders have shown more of an appetite for the stock, over the last year. We'd like to see bigger individual holdings. However, we don't see anything to make us think NextEd Group insiders are doubting the company. 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. For instance, we've identified 3 warning signs for NextEd Group (1 is concerning) you should be aware of.