How Many Pure Foods Tasmania Limited (ASX:PFT) Shares Did Insiders Buy, In The Last Year?

We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So shareholders might well want to know whether insiders have been buying or selling shares in Pure Foods Tasmania Limited (ASX:PFT).

What Is Insider Selling?

It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, rules govern insider transactions, and certain disclosures are required.

Insider transactions are not the most important thing when it comes to long-term investing. But it is perfectly logical to keep tabs on what insiders are doing. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year'.

Check out our latest analysis for Pure Foods Tasmania

Pure Foods Tasmania Insider Transactions Over The Last Year

The MD & Director Michael Cooper made the biggest insider purchase in the last 12 months. That single transaction was for AU$408k worth of shares at a price of AU$1.03 each. That means that an insider was happy to buy shares at above the current price of AU$0.89. Their view may have changed since then, but at least it shows they felt optimistic at the time. To us, it's very important to consider the price insiders pay for shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.

Over the last year, we can see that insiders have bought 1.47m shares worth AU$1.1m. But insiders sold 155.00k shares worth AU$183k. In total, Pure Foods Tasmania insiders bought more than they sold over the last year. They paid about AU$0.73 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 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!

Pure Foods Tasmania 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.

Pure Foods Tasmania Insiders Bought Stock Recently

It's good to see that Pure Foods Tasmania insiders have made notable investments in the company's shares. MD & Director Michael Cooper spent AU$135k on stock, and there wasn't any selling. That shows some optimism about the company's future.

Insider Ownership

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. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It appears that Pure Foods Tasmania insiders own 33% of the company, worth about AU$16m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

What Might The Insider Transactions At Pure Foods Tasmania Tell Us?

It's certainly positive 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 Pure Foods Tasmania 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 Pure Foods Tasmania. For example - Pure Foods Tasmania has 4 warning signs we think you should be aware of.

But note: Pure Foods Tasmania 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.

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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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