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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 Strickland Metals Limited (ASX:STK), 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 would consider it foolish to ignore insider transactions altogether.
See our latest analysis for Strickland Metals
The Last 12 Months Of Insider Transactions At Strickland Metals
In the last twelve months, the biggest single purchase by an insider was when insider Shane Ball bought AU$404k worth of shares at a price of AU$0.059 per share. Even though the purchase was made at a significantly lower price than the recent price (AU$0.095), we still think insider buying is a positive. 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.
While Strickland Metals insiders bought shares during the last year, they didn't sell. Their average price was about AU$0.068. To my mind it is good that insiders have invested their own money in the company. However, we do note that they were buying at significantly lower prices than today's share price. The chart below shows insider transactions (by companies and individuals) over the last year. 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 undervalued small cap companies that insiders are buying.
Insiders At Strickland Metals Have Bought Stock Recently
We saw some Strickland Metals insider buying shares in the last three months. MD & Director Paul L'Herpiniere purchased AU$20k worth of shares in that period. It's good to see the insider buying, as well as the lack of recent sellers. But the amount invested in the last three months isn't enough for us too put much weight on it, as a single factor.
Does Strickland Metals Boast High 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. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 21% of Strickland Metals shares, worth about AU$44m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.