Insider Stock Buying Of Empire Energy Group Delivers Return On AU$7.71m Investment

Empire Energy Group Limited (ASX:EEG) insiders who acquired shares over the previous 12 months, can probably afford to ignore the recent 14% decline in the stock price. After taking the recent loss into consideration, the AU$7.71m worth of stock they bought is now worth AU$9.83m, indicating that their investment yielded a positive return.

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.

See our latest analysis for Empire Energy Group

Empire Energy Group Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when insider Bryan Sheffield bought AU$6.2m worth of shares at a price of AU$0.16 per share. We do like to see buying, but this purchase was made at well below the current price of AU$0.21. 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.

While Empire Energy Group insiders bought shares during the last year, they didn't sell. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

Empire Energy Group is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.

Empire Energy Group Insiders Bought Stock Recently

It's good to see that Empire Energy Group insiders have made notable investments in the company's shares. We can see that insider Paul Fudge paid AU$149k for shares in the company. No-one sold. This is a positive in our book as it implies some confidence.

Insider Ownership Of Empire Energy Group

Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. It appears that Empire Energy Group insiders own 28% of the company, worth about AU$59m. 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 Empire Energy Group Insider Transactions Indicate?

It is good to see the recent insider purchase. And the longer term insider transactions also give us confidence. But on the other hand, the company made a loss during the last year, which makes us a little cautious. Insiders likely see value in Empire Energy Group shares, given these transactions (along with notable insider ownership of the company). While it's good to be aware of 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. Case in point: We've spotted 2 warning signs for Empire Energy Group you should be aware of.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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 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.