Optiscan Imaging Insiders Land Bargain With Gains Of AU$2.1m

Insiders who bought Optiscan Imaging Limited (ASX:OIL) stock lover the last 12 months are probably not as affected by last week’s 16% loss. Even after accounting for the recent loss, the AU$1.35m worth of stock purchased by them is now worth AU$3.50m or in other words, their investment continues to give good returns.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

View our latest analysis for Optiscan Imaging

The Last 12 Months Of Insider Transactions At Optiscan Imaging

In the last twelve months, the biggest single purchase by an insider was when insider Robert Peters bought AU$1.1m worth of shares at a price of AU$0.084 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of AU$0.21. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

Happily, we note that in the last year insiders paid AU$1.4m for 16.27m shares. But insiders sold 4.58m shares worth AU$360k. Overall, Optiscan Imaging insiders were net buyers during the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

Optiscan Imaging is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.

Insiders At Optiscan Imaging Have Bought Stock Recently

Over the last three months, we've seen significant insider buying at Optiscan Imaging. Specifically, insider Robert Peters bought AU$1.1m worth of shares in that time, and we didn't record any sales whatsoever. This could be interpreted as suggesting a positive outlook.

Insider Ownership

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Optiscan Imaging insiders own about AU$66m worth of shares. That equates to 37% of the company. 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 Optiscan Imaging Tell Us?

It's certainly positive to see the recent insider purchase. We also take confidence from the longer term picture of insider transactions. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. Insiders likely see value in Optiscan Imaging shares, given these transactions (along with notable insider ownership of the company). So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For example, Optiscan Imaging has 4 warning signs (and 1 which is a bit unpleasant) we think you should know about.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com