Foresta Group Holding Up 23%, Insider Buyers Are Up 23%

Last week, Foresta Group Holding Limited (ASX:FGH) insiders, who had purchased shares in the previous 12 months were rewarded handsomely. The shares increased by 23% last week, resulting in a AU$6.7m increase in the company's market worth, implying a 23% gain on their initial purchase. In other words, the original AU$1.01m purchase is now worth AU$1.24m.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

See our latest analysis for Foresta Group Holding

The Last 12 Months Of Insider Transactions At Foresta Group Holding

In the last twelve months, the biggest single purchase by an insider was when insider Wayne Russell bought AU$1m worth of shares at a price of AU$0.013 per share. Even though the purchase was made at a significantly lower price than the recent price (AU$0.016), we still think insider buying is a positive. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

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

Foresta Group Holding is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Are Foresta Group Holding Insiders Buying Or Selling?

MD & Executive Director Ramon Mountfort bought just AU$5.0k worth of shares in that time. That's not much at all. So it is hard to draw any conclusion about how insiders are feeling about the stock, from these recent trades.

Insider Ownership

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. I reckon it's a good sign if insiders own a significant number of shares in the company. Foresta Group Holding insiders own 56% of the company, currently worth about AU$20m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Does This Data Suggest About Foresta Group Holding Insiders?

Insider purchases may have been minimal, in the last three months, but there was no selling at all. Overall the buying isn't worth writing home about. On a brighter note, the transactions over the last year are encouraging. Judging from their transactions, and high insider ownership, Foresta Group Holding insiders feel good about the company's future. 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. To that end, you should learn about the 5 warning signs we've spotted with Foresta Group Holding (including 3 which shouldn't be ignored).

Of course Foresta Group Holding 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 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.