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Investors who take an interest in International Graphite Limited (ASX:IG6) should definitely note that the Founder & Non-Executive Chairman, Philip Hearse, recently paid AU$0.12 per share to buy AU$220k worth of the stock. That's a very decent purchase to our minds and it grew their holding by a solid 10%.
See our latest analysis for International Graphite
The Last 12 Months Of Insider Transactions At International Graphite
In fact, the recent purchase by Philip Hearse was the biggest purchase of International Graphite shares made by an insider individual in the last twelve months, according to our records. That means that an insider was happy to buy shares at above the current price of AU$0.085. 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. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.
In the last twelve months International Graphite insiders were buying shares, but not selling. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.
Insider Ownership
Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. International Graphite insiders own about AU$3.2m worth of shares. That equates to 18% of the company. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
So What Does This Data Suggest About International Graphite Insiders?
The recent insider purchase is heartening. We also take confidence from the longer term picture of insider transactions. But we don't feel the same about the fact the company is making losses. Given that insiders also own a fair bit of International Graphite we think they are probably pretty confident of a bright future. 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. When we did our research, we found 5 warning signs for International Graphite (2 are potentially serious!) that we believe deserve your full attention.