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Looking at Fitzroy River Corporation Limited's (ASX:FZR ) insider transactions over the last year, we can see that insiders were net buyers. That is, there were more number of shares purchased by insiders than there were sold.
Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.
See our latest analysis for Fitzroy River
Fitzroy River Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider purchase was by insider Troy Harry for AU$283k worth of shares, at about AU$0.13 per share. That means that an insider was happy to buy shares at above the current price of AU$0.13. Their view may have changed since then, but at least it shows they felt optimistic at the time. In our view, the price an insider pays for shares is very important. 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. Troy Harry was the only individual insider to buy shares in the last twelve months.
You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!
Fitzroy River is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.
Does Fitzroy River Boast High Insider Ownership?
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. Fitzroy River insiders own about AU$6.7m worth of shares (which is 49% of the company). 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 Fitzroy River Tell Us?
It doesn't really mean much that no insider has traded Fitzroy River shares in the last quarter. But insiders have shown more of an appetite for the stock, over the last year. Judging from their transactions, and high insider ownership, Fitzroy River insiders feel good about the company's 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. At Simply Wall St, we found 3 warning signs for Fitzroy River that deserve your attention before buying any shares.