In This Article:
It is usually uneventful when a single insider buys stock. However, When quite a few insiders buy shares, as it happened in Delta Lithium Limited's (ASX:DLI) case, it's fantastic news for shareholders.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.
See our latest analysis for Delta Lithium
Delta Lithium Insider Transactions Over The Last Year
The insider Amanda Croser made the biggest insider purchase in the last 12 months. That single transaction was for AU$300k worth of shares at a price of AU$0.46 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being AU$0.24). Their view may have changed since then, but at least it shows they felt optimistic at the time. To us, it's very important to consider the price insiders pay for shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.
While Delta Lithium insiders bought shares during the last year, they didn't sell. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Delta Lithium 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 Delta Lithium 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. We usually like to see fairly high levels of insider ownership. Based on our data, Delta Lithium insiders have about 1.9% of the stock, worth approximately AU$3.3m. However, it's possible that insiders might have an indirect interest through a more complex structure. We prefer to see high levels of insider ownership.
So What Does This Data Suggest About Delta Lithium Insiders?
It doesn't really mean much that no insider has traded Delta Lithium shares in the last quarter. However, our analysis of transactions over the last year is heartening. We'd like to see bigger individual holdings. However, we don't see anything to make us think Delta Lithium insiders are doubting the company. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. To that end, you should learn about the 3 warning signs we've spotted with Delta Lithium (including 2 which are concerning).