When a single insider purchases stock, it is typically not a major deal. However, when multiple insiders purchase stock, like in Spacetalk Limited's (ASX:SPA) instance, it's good news for shareholders.
Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.
Check out our latest analysis for Spacetalk
Spacetalk Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when Independent Non-Executive Chairman Georg Chmiel bought AU$100k worth of shares at a price of AU$0.03 per share. That means that even when the share price was higher than AU$0.029 (the recent price), an insider wanted to purchase shares. 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 always take careful note of the price insiders pay when purchasing shares. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.
In the last twelve months insiders purchased 6.35m shares for AU$190k. On the other hand they divested 4.37m shares, for AU$190k. In the last twelve months there was more buying than selling by Spacetalk insiders. 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!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
Are Spacetalk Insiders Buying Or Selling?
We've only seen a tiny insider purchase valued at AU$4.6k, in the last three months. Looking at the net result, we don't think these recent trades shed much light on how insiders, as a group, are feeling about the company's prospects.
Does Spacetalk Boast High 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. It appears that Spacetalk insiders own 19% of the company, worth about AU$1.7m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.