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Usually, when one insider buys stock, it might not be a monumental event. But when multiple insiders are buying like they did in the case of Scales Corporation Limited (NZSE:SCL), that sends out a positive message to the company's shareholders.
While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.
Scales Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider purchase was by Non-Executive Independent Director Miranda Burdon for NZ$194k worth of shares, at about NZ$3.53 per share. We do like to see buying, but this purchase was made at well below the current price of NZ$4.28. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.
Scales 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 want to know exactly who sold, for how much, and when, simply click on the graph below!
Check out our latest analysis for Scales
Scales is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.
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. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 3.4% of Scales shares, worth about NZ$21m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
So What Does This Data Suggest About Scales Insiders?
It doesn't really mean much that no insider has traded Scales shares in the last quarter. On a brighter note, the transactions over the last year are encouraging. Overall we don't see anything to make us think Scales insiders are doubting the company, and they do own shares. Of course, the future is what matters most. So if you are interested in Scales, you should check out this free report on analyst forecasts for the company.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity and low debt.