ENRG Elements Insiders Added AU$1.38m Of Stock To Their Holdings

Multiple insiders secured a larger position in ENRG Elements Limited (ASX:EEL) shares over the last 12 months. This is reassuring as this suggests that insiders have increased optimism about the company's prospects.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.

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The Last 12 Months Of Insider Transactions At ENRG Elements

In the last twelve months, the biggest single purchase by an insider was when insider Jiandong He bought AU$979k worth of shares at a price of AU$0.002 per share. That means that an insider was happy to buy shares at above the current price of AU$0.0015. Their view may have changed since then, but at least it shows they felt optimistic at the time. In our view, the price an insider pays for shares is very important. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.

In the last twelve months insiders purchased 888.79m shares for AU$1.4m. But they sold 140.00m shares for AU$280k. Overall, ENRG Elements insiders were net buyers during the last year. They paid about AU$0.0016 on average. These transactions suggest that insiders have considered the current price attractive. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

View our latest analysis for ENRG Elements

There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).

ENRG Elements Insiders Bought Stock Recently

There has been significantly more insider buying, than selling, at ENRG Elements, over the last three months. In total, three insiders bought AU$1.1m worth of shares in that time. But we did see Non-Executive Director Michael Soucik sell shares worth AU$280k. We think insiders may be optimistic about the future, since insiders have been net buyers of shares.

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. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 38% of ENRG Elements shares, worth about AU$1.9m. 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 ENRG Elements Tell Us?

It's certainly positive to see the recent insider purchases. And the longer term insider transactions also give us confidence. 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 ENRG Elements shares, given these transactions (along with notable insider ownership of the company). In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing ENRG Elements. You'd be interested to know, that we found 5 warning signs for ENRG Elements and we suggest you have a look.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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 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.