Whilst it may not be a huge deal, we thought it was good to see that the Viva Leisure Limited (ASX:VVA) Independent Non Executive Director, Susan Forrester, recently bought AU$81k worth of stock, for AU$2.70 per share. While we’re hesitant to get too excited about a purchase of that size, we do note it increased their holding by a solid 43%.
Viva Leisure Insider Transactions Over The Last Year
In fact, the recent purchase by Independent Non Executive Director Susan Forrester was not their only acquisition of Viva Leisure shares this year. Earlier in the year, they paid AU$2.88 per share in a AU$102k purchase. That means that even when the share price was higher than AU$2.25 (the recent price), an insider wanted to purchase shares. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company’s future. In our view, the price an insider pays for shares is very important. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.
Viva Leisure insiders may have bought shares in the last year, but they didn’t sell any. They paid about AU$1.83 on average. It’s great to see insiders putting their own cash into the company’s stock, albeit at below the recent share price. You can see a visual depiction of insider transactions (by 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!
Viva Leisure is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Does Viva Leisure 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. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Viva Leisure insiders own about AU$17m worth of shares. That equates to 12% 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 Viva Leisure Insider Transactions Indicate?
It is good to see recent purchasing. We also take confidence from the longer term picture of insider transactions. Given that insiders also own a fair bit of Viva Leisure we think they are probably pretty confident of a bright future. In addition to knowing about insider transactions going on, it’s beneficial to identify the risks facing Viva Leisure. Every company has risks, and we’ve spotted 3 warning signs for Viva Leisure you should know about.
But note: Viva Leisure 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, but not derivative transactions.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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. Simply Wall St has no position in the stocks mentioned.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.