The Independent Non-Executive Director of Humm Group Limited (ASX:HUM), Robert Hines, Just Bought A Few More Shares

Even if it's not a huge purchase, we think it was good to see that Robert Hines, the Independent Non-Executive Director of Humm Group Limited (ASX:HUM) recently shelled out AU$60k to buy stock, at AU$0.60 per share. Although the purchase is not a big one, by either a percentage standpoint or absolute value, it can be seen as a good sign.

Our analysis indicates that HUM is potentially undervalued!

Humm Group Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider purchase was by Founding Non-Independent Non-Executive Chairman of the Board Andrew Abercrombie for AU$5.1m worth of shares, at about AU$0.81 per share. That means that an insider was happy to buy shares at above the current price of AU$0.57. Their view may have changed since then, but at least it shows they felt optimistic at the time. In our view, the price an insider pays for shares is very important. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.

Humm Group insiders may have bought shares in the last year, but they didn't sell any. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.

Insider Ownership Of Humm Group

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. We usually like to see fairly high levels of insider ownership. Humm Group insiders own about AU$84m worth of shares. That equates to 30% of the company. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Do The Humm Group Insider Transactions Indicate?

It is good to see the recent insider purchase. And the longer term insider transactions also give us confidence. But we don't feel the same about the fact the company is making losses. Given that insiders also own a fair bit of Humm Group we think they are probably pretty confident of a bright future. 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. Every company has risks, and we've spotted 2 warning signs for Humm Group you should know about.

Of course Humm Group 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.