With AusQuest Up 39%, Insider Buyers Count Their Returns

Insiders who bought AusQuest Limited (ASX:AQD) stock in the last 12 months were richly rewarded last week. The company's market value increased by AU$15m as a result of the stock's 39% gain over the same period. In other words, the original AU$600.8k purchase is now worth AU$3.45m.

While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.

See our latest analysis for AusQuest

The Last 12 Months Of Insider Transactions At AusQuest

In the last twelve months, the biggest single purchase by an insider was when Non-Executive Director Christopher Ellis bought AU$539k worth of shares at a price of AU$0.008 per share. We do like to see buying, but this purchase was made at well below the current price of AU$0.046. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

While AusQuest insiders bought shares during the last year, they didn't sell. 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!

AusQuest 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.

Does AusQuest 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. A high insider ownership often makes company leadership more mindful of shareholder interests. AusQuest insiders own about AU$19m worth of shares. That equates to 36% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

What Might The Insider Transactions At AusQuest Tell Us?

It doesn't really mean much that no insider has traded AusQuest shares in the last quarter. But insiders have shown more of an appetite for the stock, over the last year. Overall we don't see anything to make us think AusQuest insiders are doubting the company, and they do own shares. 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 5 warning signs for AusQuest you should be aware of, and 4 of them are significant.

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.