Cluey Up 10%, Insider Buyers Are Up 150%

Cluey Ltd (ASX:CLU) insiders who purchased shares in the last 12 months were richly rewarded last week. The stock climbed by 10% resulting in a AU$2.5m addition to the company’s market value. As a result, the stock they originally bought for AU$1.30m is now worth AU$3.25m.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

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The Last 12 Months Of Insider Transactions At Cluey

In the last twelve months, the biggest single purchase by an insider was when Co-Founder & Non Executive Deputy Chairman Mark Rohald bought AU$1m worth of shares at a price of AU$0.03 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of AU$0.075. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

Cluey insiders may have bought shares in the last year, but they didn't sell any. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

View our latest analysis for Cluey

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

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Cluey insiders own about AU$7.0m worth of shares. That equates to 27% 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.

So What Do The Cluey Insider Transactions Indicate?

There haven't been any insider transactions in the last three months -- that doesn't mean much. However, our analysis of transactions over the last year is heartening. Insiders do have a stake in Cluey and their transactions don't cause us concern. 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've found that Cluey has 3 warning signs (2 are potentially serious!) that deserve your attention before going any further with your analysis.

Of course Cluey may not be the best stock to buy. So you may wish to see this free collection of high quality companies.

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.