Insider Buyers At COG Financial Services Likely Disappointed With 14% Slide

The recent price decline of 14% in COG Financial Services Limited's (ASX:COG) stock may have disappointed insiders who bought AU$827.4k worth of shares at an average price of AU$1.37 in the past 12 months. This is not good as insiders invest based on expectations that their money will appreciate over time. However, as a result of recent losses, their original investment is now worth only AU$728.4k.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

View our latest analysis for COG Financial Services

COG Financial Services Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when Executive Director and Head of Finance Broking & Aggregation Cameron McCullagh bought AU$378k worth of shares at a price of AU$1.39 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being AU$1.21). It's very possible they regret the purchase, but it's more likely they are bullish about the company. To us, it's very important to consider the price insiders pay for shares. Generally speaking, it catches our eye when an insider has purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price. Cameron McCullagh was the only individual insider to buy during the last year.

Cameron McCullagh bought a total of 602.01k shares over the year at an average price of AU$1.37. 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!

COG Financial Services is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Insider Ownership Of COG Financial Services

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that COG Financial Services insiders own 24% of the company, worth about AU$62m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

What Might The Insider Transactions At COG Financial Services Tell Us?

There haven't been any insider transactions in the last three months -- that doesn't mean much. On a brighter note, the transactions over the last year are encouraging. Insiders do have a stake in COG Financial Services and their transactions don't cause us concern. While we like knowing 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. You'd be interested to know, that we found 5 warning signs for COG Financial Services and we suggest you have a look.

Of course COG Financial Services 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.