PointsBet Holdings Limited (ASX:PBH) Insiders Increased Their Holdings

We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So we'll take a look at whether insiders have been buying or selling shares in PointsBet Holdings Limited (ASX:PBH).

Do Insider Transactions Matter?

Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock in the company. However, rules govern insider transactions, and certain disclosures are required.

We don't think shareholders should simply follow insider transactions. But logic dictates you should pay some attention to whether insiders are buying or selling shares. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise'.

Check out our latest analysis for PointsBet Holdings

PointsBet Holdings Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider purchase was by insider Brett Paton for AU$6.9m worth of shares, at about AU$6.50 per share. Even though the purchase was made at a significantly lower price than the recent price (AU$11.88), we still think insider buying is a positive. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.

Happily, we note that in the last year insiders paid AU$8.8m for 1.30m shares. But insiders sold 342.21k shares worth AU$3.8m. In the last twelve months there was more buying than selling by PointsBet Holdings insiders. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

PointsBet 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.

PointsBet Holdings Insiders Bought Stock Recently

Over the last three months, we've seen significant insider buying at PointsBet Holdings. We can see that insider Brett Paton paid AU$998k for shares in the company. No-one sold. This makes one think the business has some good points.

Does PointsBet Holdings Boast High Insider Ownership?

Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. It's great to see that PointsBet Holdings insiders own 21% of the company, worth about AU$512m. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Do The PointsBet Holdings Insider Transactions Indicate?

It is good to see the recent insider purchase. And an analysis of the transactions over the last year also gives us confidence. But on the other hand, the company made a loss during the last year, which makes us a little cautious. Along with the high insider ownership, this analysis suggests that insiders are quite bullish about PointsBet Holdings. One for the watchlist, at least! So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. To help with this, we've discovered 3 warning signs (1 doesn't sit too well with us!) that you ought to be aware of before buying any shares in PointsBet Holdings.

Of course PointsBet Holdings 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. 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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