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We’ve lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. On the other hand, we’d be remiss not to mention that insider sales have been known to precede tough periods for a business. So we’ll take a look at whether insiders have been buying or selling shares in amaysim Australia Limited (ASX:AYS).
What Is Insider Buying?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, such insiders must disclose their trading activities, and not trade on inside information.
We don’t think shareholders should simply follow insider transactions. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Columbia University study found that ‘insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers’.
amaysim Australia Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when Founder Peter O’Connell bought AU$360k worth of shares at a price of AU$0.60 per share. So it’s clear an insider wanted to buy, at around the current price, which is AU$0.74. 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. While we always like to see insider buying, it’s less meaningful if the purchases were made at much lower prices, as the opportunity they saw may have passed. In this case we’re pleased to report that the insider purchases were made at close to current prices.
In the last twelve months insiders paid AU$960k for 1.6m shares purchased. In the last twelve months amaysim Australia insiders were buying shares, but not selling. The chart below shows insider transactions (by 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!
amaysim Australia is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
amaysim Australia Insiders Bought Stock Recently
Over the last three months, we’ve seen significant insider buying at amaysim Australia. Overall, three insiders shelled out AU$612k for shares in the company — and none sold. This is a positive in our book as it implies some confidence.
Insider Ownership of amaysim Australia
For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. From our data, it seems that amaysim Australia insiders own 5.6% of the company, worth about AU$12m. Whilst better than nothing, we’re not overly impressed by these holdings.
So What Does This Data Suggest About amaysim Australia Insiders?
The recent insider purchases are heartening. And an analysis of the transactions over the last year also gives us confidence. But on the other hand, the company made a loss last year, which makes us a little cautious. When combined with notable insider ownership, these factors suggest amaysim Australia insiders are well aligned, and that they may think the share price is too low. If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.