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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 Fertoz Limited (ASX:FTZ), 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, logic dictates you should pay some attention to whether insiders are buying or selling shares.
Check out our latest analysis for Fertoz
The Last 12 Months Of Insider Transactions At Fertoz
Over the last year, we can see that the biggest insider purchase was by Non-Executive Chairman Stuart Richardson for AU$100k worth of shares, at about AU$0.18 per share. That means that even when the share price was higher than AU$0.028 (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. To us, it's very important to consider the price insiders pay for 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.
While Fertoz insiders bought shares during the last year, they didn't sell. 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!
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.
Insider Ownership
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It appears that Fertoz insiders own 26% of the company, worth about AU$1.8m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
So What Do The Fertoz Insider Transactions Indicate?
It doesn't really mean much that no insider has traded Fertoz shares in the last quarter. However, our analysis of transactions over the last year is heartening. Overall we don't see anything to make us think Fertoz insiders are doubting the company, and they do own shares. 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 5 warning signs we've spotted with Fertoz (including 4 which are significant).