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The recent price decline of 31% in Top Shelf International Holdings Ltd's (ASX:TSI) stock may have disappointed insiders who bought AU$1.45m worth of shares at an average price of AU$0.25 in the past 12 months. This is not good as insiders invest based on expectations that their money will appreciate over time. However, as a result of recent losses, their original investment is now worth only AU$539.4k.
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.
Check out our latest analysis for Top Shelf International Holdings
Top Shelf International Holdings Insider Transactions Over The Last Year
The Non-Executive Director Adem Karafili made the biggest insider purchase in the last 12 months. That single transaction was for AU$1.5m worth of shares at a price of AU$0.25 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being AU$0.093). It's very possible they regret the purchase, but it's more likely they are bullish about the company. To us, it's very important to consider the price insiders pay for shares. As a general rule, we feel more positive about a stock when an insider has bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price. Adem Karafili was the only individual insider to buy shares in the last twelve months. We note that Adem Karafili was both the biggest buyer and the biggest seller.
The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Top Shelf International Holdings is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.
Does Top Shelf International Holdings Boast High Insider Ownership?
Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. From looking at our data, insiders own AU$1.2m worth of Top Shelf International Holdings stock, about 4.1% of the company. However, it's possible that insiders might have an indirect interest through a more complex structure. We prefer to see high levels of insider ownership.
So What Does This Data Suggest About Top Shelf International Holdings Insiders?
The fact that there have been no Top Shelf International Holdings insider transactions recently certainly doesn't bother us. However, our analysis of transactions over the last year is heartening. We'd like to see bigger individual holdings. However, we don't see anything to make us think Top Shelf International Holdings insiders are doubting the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Top Shelf International Holdings. For instance, we've identified 4 warning signs for Top Shelf International Holdings (3 make us uncomfortable) you should be aware of.