Insiders Who Purchased AU$1.22m Of Sprintex Stock May Not Have Expected 11% Tumble

Insiders who bought AU$1.22m worth of Sprintex Limited's (ASX:SIX) stock at an average buy price of AU$0.052 over the last year may be disappointed by the recent 11% decrease in the stock. Insiders purchase with the hope of seeing their investments increase in value over time. However, due to recent losses, their initial investment is now only worth AU$977.8k, which is not great.

Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.

Our free stock report includes 6 warning signs investors should be aware of before investing in Sprintex. Read for free now.

The Last 12 Months Of Insider Transactions At Sprintex

Over the last year, we can see that the biggest insider purchase was by insider Richard Siemens for AU$850k worth of shares, at about AU$0.05 per share. That means that an insider was happy to buy shares at above the current price of AU$0.042. Their view may have changed since then, but at least it shows they felt optimistic at the time. We always take careful note of the price insiders pay when purchasing shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.

While Sprintex 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. By clicking on the graph below, you can see the precise details of each insider transaction!

See our latest analysis for Sprintex

Sprintex is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.

Insiders At Sprintex Have Bought Stock Recently

It's good to see that Sprintex insiders have made notable investments in the company's shares. Overall, three insiders shelled out AU$1.2m for shares in the company -- and none sold. This could be interpreted as suggesting a positive outlook.

Does Sprintex 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. We usually like to see fairly high levels of insider ownership. It's great to see that Sprintex insiders own 48% of the company, worth about AU$13m. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Do The Sprintex Insider Transactions Indicate?

The recent insider purchases are heartening. 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 Sprintex insiders are well aligned, and quite possibly think the share price is too low. Looks promising! While it's good to be aware of 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. For example, Sprintex has 6 warning signs (and 3 which shouldn't be ignored) we think you should know about.

But note: Sprintex 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.

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

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.