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Even if it's not a huge purchase, we think it was good to see that Lev Mizikovsky, the Non-Executive Chairman of Advance ZincTek Limited (ASX:ANO) recently shelled out AU$78k to buy stock, at AU$0.76 per share. Although the purchase is not a big one, by either a percentage standpoint or absolute value, it can be seen as a good sign.
Check out our latest analysis for Advance ZincTek
Advance ZincTek Insider Transactions Over The Last Year
In fact, the recent purchase by Non-Executive Chairman Lev Mizikovsky was not their only acquisition of Advance ZincTek shares this year. They previously made an even bigger purchase of AU$2.0m worth of shares at a price of AU$1.05 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being AU$0.78). Their view may have changed since then, but at least it shows they felt optimistic at the time. We always take careful note of the price insiders pay when purchasing 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. Lev Mizikovsky was the only individual insider to buy during the last year.
Lev Mizikovsky bought a total of 6.97m shares over the year at an average price of AU$1.05. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).
Insider Ownership Of Advance ZincTek
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. Advance ZincTek insiders own 71% of the company, currently worth about AU$34m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
What Might The Insider Transactions At Advance ZincTek Tell Us?
It is good to see the recent insider purchase. 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. Once you factor in the high insider ownership, it certainly seems like insiders are positive about Advance ZincTek. Nice! 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 2 warning signs (1 makes us a bit uncomfortable!) that you ought to be aware of before buying any shares in Advance ZincTek.