Investors who take an interest in Steadfast Group Limited (ASX:SDF) should definitely note that the Non-Executive Independent Chairman, Francis Michael O'Halloran, recently paid AU$3.40 per share to buy AU$350k worth of the stock. That's a very solid buy in our book, and increased their holding by a noteworthy 12%.
The Last 12 Months Of Insider Transactions At Steadfast Group
Over the last year, we can see that the biggest insider sale was by the Co-Founder, Robert Kelly, for AU$637k worth of shares, at about AU$3.64 per share. So we know that an insider sold shares at around the present share price of AU$3.44. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. Given that the sale took place at around current prices, it makes us a little cautious but is hardly a major concern.
Over the last year, we can see that insiders have bought 431.00k shares worth AU$1.5m. But they sold 400.00k shares for AU$1.5m. All up, insiders sold more shares in Steadfast Group than they bought, over the last year. The sellers received a price of around AU$3.66, on average. We don't gain confidence from insider selling below the recent share price. Since insiders sell for many reasons, we wouldn't put too much weight on it. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.
Does Steadfast Group Boast High 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. Insiders own 1.4% of Steadfast Group shares, worth about AU$42m. 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 Steadfast Group Insider Transactions Indicate?
The recent insider purchase is heartening. However, the longer term transactions are not so encouraging. We don't take much heart from transactions by Steadfast Group insiders over the last year. But they own a reasonable amount of the company, and there was some buying recently. Overall they seem reasonably aligned. 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. Be aware that Steadfast Group is showing 3 warning signs in our investment analysis, and 1 of those is a bit unpleasant...
Of course Steadfast 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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