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Those following along with ARB Corporation Limited (ASX:ARB) will no doubt be intrigued by the recent purchase of shares by Roger Brown, Non-Executive Director of the company, who spent a stonking AU$1m on stock at an average price of AU$33.13. There's no denying a buy of that magnitude suggests conviction in a brighter future, although we do note that proportionally it only increased their holding by 0.6%.
View our latest analysis for ARB
The Last 12 Months Of Insider Transactions At ARB
In fact, the recent purchase by Roger Brown was the biggest purchase of ARB shares made by an insider individual in the last twelve months, according to our records. So it's clear an insider wanted to buy, at around the current price, which is AU$33.41. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. We do always like to see insider buying, but it is worth noting if those purchases were made at well below today's share price, as the discount to value may have narrowed with the rising price. Happily, the ARB insiders decided to buy shares at close to current prices.
ARB insiders may have bought shares in the last year, but they didn't sell any. 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!
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).
Does ARB Boast High Insider Ownership?
For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It's great to see that ARB insiders own 7.6% of the company, worth about AU$211m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
So What Does This Data Suggest About ARB Insiders?
The recent insider purchases are heartening. And an analysis of the transactions over the last year also gives us confidence. When combined with notable insider ownership, these factors suggest ARB insiders are well aligned, and quite possibly think the share price is too low. One for the watchlist, at least! Therefore, you should definitely take a look at this FREE report showing analyst forecasts for ARB.