Quite a few insiders invested in Domino's Pizza Enterprises Limited (ASX:DMP) last year which is positive news for shareholders

It is usually uneventful when a single insider buys stock. However, When quite a few insiders buy shares, as it happened in Domino's Pizza Enterprises Limited's (ASX:DMP) case, it's fantastic news for shareholders.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

See our latest analysis for Domino's Pizza Enterprises

The Last 12 Months Of Insider Transactions At Domino's Pizza Enterprises

The Non-Executive Director Doreen Huber made the biggest insider purchase in the last 12 months. That single transaction was for AU$87k worth of shares at a price of AU$86.80 each. We do like to see buying, but this purchase was made at well below the current price of AU$125. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

In the last twelve months Domino's Pizza Enterprises insiders were buying shares, but not selling. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

Domino's Pizza Enterprises 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.

Does Domino's Pizza Enterprises Boast High Insider Ownership?

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. Domino's Pizza Enterprises insiders own about AU$609m worth of shares (which is 5.6% of the company). 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 Domino's Pizza Enterprises Tell Us?

There haven't been any insider transactions in the last three months -- that doesn't mean much. But insiders have shown more of an appetite for the stock, over the last year. Judging from their transactions, and high insider ownership, Domino's Pizza Enterprises insiders feel good about the company's future. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Case in point: We've spotted 1 warning sign for Domino's Pizza Enterprises you should be aware of.

Of course Domino's Pizza Enterprises 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, but not derivative transactions.

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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.
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