We often see insiders buying up shares in companies that perform well over the long term. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So shareholders might well want to know whether insiders have been buying or selling shares in Johns Lyng Group Limited (ASX:JLG).

Do Insider Transactions Matter?

Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock in the company. However, most countries require that the company discloses such transactions to the market.

Insider transactions are not the most important thing when it comes to long-term investing. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year.

View our latest analysis for Johns Lyng Group

The Last 12 Months Of Insider Transactions At Johns Lyng Group

In the last twelve months, the biggest single purchase by an insider was when MD, CEO & Executive Director Scott Didier bought AU$148k worth of shares at a price of AU$2.13 per share. That means that an insider was happy to buy shares at around the current price of AU$2.39. Of course they may have changed their mind. But this suggests they are optimistic. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. In this case we're pleased to report that the insider purchases were made at close to current prices.

In the last twelve months Johns Lyng Group insiders were buying shares, but not selling. You can see the insider transactions (by 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!

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.

Insiders at Johns Lyng Group Have Bought Stock Recently

Over the last three months, we've seen significant insider buying at Johns Lyng Group. We can see that MD, CEO & Executive Director Scott Didier paid AU$148k for shares in the company. No-one sold. This is a positive in our book as it implies some confidence.

Insider Ownership of Johns Lyng Group

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Johns Lyng Group insiders own about AU$205m worth of shares (which is 39% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.