Fulcrum Lithium Insiders Land Bargain With Gains Of AU$1.0m

Insiders who bought Fulcrum Lithium Ltd (ASX:FUL) stock lover the last 12 months are probably not as affected by last week’s 13% loss. Reason being, despite the recent loss, insiders original purchase value of AU$1.42m is now worth AU$2.44m.

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.

This technology could replace computers: discover the 20 stocks are working to make quantum computing a reality.

Fulcrum Lithium Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when Executive Chairman Norman Seckold bought AU$1.4m worth of shares at a price of AU$0.20 per share. That means that even when the share price was higher than AU$0.07 (the recent price), an insider wanted to purchase shares. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. We always take careful note of the price insiders pay when purchasing shares. As a general rule, we feel more positive about a stock when an insider has bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price. The only individual insider to buy over the last year was Norman Seckold.

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!

Check out our latest analysis for Fulcrum Lithium

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).

Insider Ownership

Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. Fulcrum Lithium insiders own about AU$4.4m worth of shares (which is 48% of the company). I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Do The Fulcrum Lithium Insider Transactions Indicate?

It doesn't really mean much that no insider has traded Fulcrum Lithium shares in the last quarter. However, our analysis of transactions over the last year is heartening. With high insider ownership and encouraging transactions, it seems like Fulcrum Lithium insiders think the business has merit. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Fulcrum Lithium. At Simply Wall St, we found 2 warning signs for Fulcrum Lithium that deserve your attention before buying any shares.

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.

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

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.