Trade Alert: Narelle Edmunds At Stealth Global Holdings Limited (ASX:SGI), Has Just Spent AU$207k Buying 16% More Shares

By
Simply Wall St
Published
March 17, 2022
ASX:SGI
Source: Shutterstock

Investors who take an interest in Stealth Global Holdings Limited (ASX:SGI) should definitely note that insider Narelle Edmunds recently paid AU$0.14 per share to buy AU$207k worth of the stock. That's a very solid buy in our book, and increased their holding by a noteworthy 16%.

See our latest analysis for Stealth Global Holdings

Stealth Global Holdings Insider Transactions Over The Last Year

Notably, that recent purchase by insider Narelle Edmunds was not the only time they bought Stealth Global Holdings shares this year. They previously made an even bigger purchase of AU$239k worth of shares at a price of AU$0.17 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being AU$0.13). Their view may have changed since then, but at least it shows they felt optimistic at the time. In our view, the price an insider pays for shares is very important. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.

In the last twelve months Stealth Global Holdings insiders were buying shares, but not selling. They paid about AU$0.13 on average. These transactions show that insiders have confidence to invest their own money in the stock, albeit at slightly below the recent price. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

insider-trading-volume
ASX:SGI Insider Trading Volume March 17th 2022

Stealth Global Holdings is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Insider Ownership

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Stealth Global Holdings insiders own 42% of the company, currently worth about AU$5.4m 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.

What Might The Insider Transactions At Stealth Global Holdings Tell Us?

It is good to see the recent insider purchase. We also take confidence from the longer term picture of insider transactions. But we don't feel the same about the fact the company is making losses. When combined with notable insider ownership, these factors suggest Stealth Global Holdings insiders are well aligned, and quite possibly think the share price is too low. Looks promising! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Be aware that Stealth Global Holdings is showing 3 warning signs in our investment analysis, and 2 of those make us uncomfortable...

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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