The recent 5.4% drop in The Law Debenture Corporation p.l.c.'s (LON:LWDB) stock could come as a blow to insiders who purchased UK£112k worth of stock at an average buy price of UK£7.47 over the past 12 months. Insiders invest with the hopes of seeing their money grow in value over time. However, as a result of recent losses, their initial investment is now only worth UK£111k, which is not what they expected.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

View our latest analysis for Law Debenture

The Last 12 Months Of Insider Transactions At Law Debenture

Notably, that recent purchase by Mark Bridgeman is the biggest insider purchase of Law Debenture shares that we've seen in the last year. That means that even when the share price was higher than UK£7.41 (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. To us, it's very important to consider the price insiders pay for shares. Generally speaking, it catches our eye when an insider has purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price. The only individual insider to buy over the last year was Mark Bridgeman.

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!

Law Debenture is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Does Law Debenture Boast High 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. From what we can see in our data, insiders own only about UK£307k worth of Law Debenture shares. We might be missing something but that seems like very low insider ownership.

What Might The Insider Transactions At Law Debenture Tell Us?

It is good to see the recent insider purchase. And an analysis of the transactions over the last year also gives us confidence. On this analysis the only slight negative we see is the fairly low (overall) insider ownership; their transactions suggest that they are quite positive on Law Debenture stock. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. Case in point: We've spotted 1 warning sign for Law Debenture you should be aware of.