David Schwartz Spends AU$103k On Schaffer Stock

Even if it's not a huge purchase, we think it was good to see that David Schwartz, the Non-Executive Independent Director of Schaffer Corporation Limited (ASX:SFC) recently shelled out AU$103k to buy stock, at AU$20.60 per share. Although the purchase is not a big one, by either a percentage standpoint or absolute value, it can be seen as a good sign.

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Schaffer Insider Transactions Over The Last Year

In fact, the recent purchase by Non-Executive Independent Director David Schwartz was not their only acquisition of Schaffer shares this year. Earlier in the year, they paid AU$21.72 per share in a AU$113k purchase. So it's clear an insider wanted to buy, even at a higher price than the current share price (being AU$21.00). 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. Generally speaking, it catches our eye when an insider has purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price. David Schwartz was the only individual insider to buy during the last year.

David Schwartz purchased 15.36k shares over the year. The average price per share was AU$21.06. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

View our latest analysis for Schaffer

Schaffer is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.

Does Schaffer Boast High Insider Ownership?

Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. It's great to see that Schaffer insiders own 50% of the company, worth about AU$142m. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

What Might The Insider Transactions At Schaffer Tell Us?

It's certainly positive to see the recent insider purchase. And an analysis of the transactions over the last year also gives us confidence. Once you factor in the high insider ownership, it certainly seems like insiders are positive about Schaffer. Nice! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Every company has risks, and we've spotted 2 warning signs for Schaffer (of which 1 is a bit unpleasant!) you should know about.

But note: Schaffer may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.

For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions of direct interests only, but not derivative transactions or indirect interests.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.