Possible Signal As Aerometrex Insiders Sell AU$1.5m In Stock

Aerometrex Limited's (ASX:AMX) stock rose 10.0% last week, but insiders who sold AU$1.5m worth of stock over the last year are probably in a more advantageous position. Selling at an average price of AU$0.56, which is higher than the current price, may have been the best move for these insiders because their investment would have been worth less now than when they sold.

While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.

We've discovered 5 warning signs about Aerometrex. View them for free.

The Last 12 Months Of Insider Transactions At Aerometrex

The insider, Beata Serafin, made the biggest insider sale in the last 12 months. That single transaction was for AU$561k worth of shares at a price of AU$1.27 each. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The silver lining is that this sell-down took place above the latest price (AU$0.28). So it may not shed much light on insider confidence at current levels.

Over the last year we saw more insider selling of Aerometrex shares, than buying. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

Check out our latest analysis for Aerometrex

I will like Aerometrex better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Insiders At Aerometrex Have Sold Stock Recently

The last quarter saw substantial insider selling of Aerometrex shares. In total, insider Beata Serafin dumped AU$361k worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.

Insider Ownership Of Aerometrex

Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Aerometrex insiders own about AU$8.6m worth of shares. That equates to 33% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

What Might The Insider Transactions At Aerometrex Tell Us?

An insider sold Aerometrex shares recently, but they didn't buy any. Zooming out, the longer term picture doesn't give us much comfort. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. We'd practice some caution before buying! 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. Case in point: We've spotted 5 warning signs for Aerometrex you should be aware of, and 2 of these 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 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.