Insiders who bought Multistack International Limited (ASX:MSI) stock in the last 12 months recover some losses, but still down AU$124k

By
Simply Wall St
Published
January 11, 2022
ASX:MSI
Source: Shutterstock

Insiders who purchased AU$609k worth of Multistack International Limited (ASX:MSI) shares over the past year recouped some of their losses after price gained 11% last week. However, the purchase is proving to be a costly gamble, since losses made by insiders have totalled AU$124k since the time of purchase.

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.

View our latest analysis for Multistack International

Multistack International Insider Transactions Over The Last Year

The insider Gabriel Govinda made the biggest insider purchase in the last 12 months. That single transaction was for AU$609k worth of shares at a price of AU$0.061 each. That means that an insider was happy to buy shares at above the current price of AU$0.049. Their view may have changed since then, but at least it shows they felt optimistic at the time. To us, it's very important to consider the price insiders pay for shares. It is encouraging to see an insider paid above the current price for shares, as it suggests they saw value, even at higher levels. Gabriel Govinda was the only individual insider to buy during the last year. Notably Gabriel Govinda was also the biggest seller.

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!

insider-trading-volume
ASX:MSI Insider Trading Volume January 11th 2022

There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).

Does Multistack International 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. A high insider ownership often makes company leadership more mindful of shareholder interests. Multistack International insiders own 55% of the company, currently worth about AU$3.7m based on the recent share price. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Do The Multistack International Insider Transactions Indicate?

The fact that there have been no Multistack International insider transactions recently certainly doesn't bother us. However, our analysis of transactions over the last year is heartening. With high insider ownership and encouraging transactions, it seems like Multistack International insiders think the business has merit. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. Our analysis shows 5 warning signs for Multistack International (4 are a bit concerning!) and we strongly recommend you look at these before investing.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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, but not derivative transactions.

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