Neil Cathie Bought 9.5% More Shares In Coventry Group

Whilst it may not be a huge deal, we thought it was good to see that the Coventry Group Ltd (ASX:CYG) Independent Non-Executive Chairman, Neil Cathie, recently bought AU$145k worth of stock, for AU$1.45 per share. Although the purchase is not a big one, increasing their shareholding by only 9.5%, it can be interpreted as a good sign.

View our latest analysis for Coventry Group

Coventry Group Insider Transactions Over The Last Year

In fact, the recent purchase by Neil Cathie was the biggest purchase of Coventry Group shares made by an insider individual in the last twelve months, according to our records. So it's clear an insider wanted to buy, even at a higher price than the current share price (being AU$1.39). It's very possible they regret the purchase, but it's more likely they are bullish about the company. 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 Coventry Group insiders bought shares during the last year, they didn't sell. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).

Does Coventry Group Boast High Insider Ownership?

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. Our data suggests Coventry Group insiders own 4.1% of the company, worth about AU$6.7m. We consider this fairly low insider ownership.

So What Does This Data Suggest About Coventry Group Insiders?

It's certainly positive to see the recent insider purchases. And the longer term insider transactions also give us confidence. We would certainly prefer see higher levels of insider ownership but analysis of the insider transactions suggests that Coventry Group insiders are expecting a bright future. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. At Simply Wall St, we found 2 warning signs for Coventry Group that deserve your attention before buying any shares.

But note: Coventry Group 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com