Hopeful Week For Insiders Who Bought AU$3.07m Of Imdex Stock

Insiders who bought AU$3.07m worth of Imdex Limited (ASX:IMD) stock in the last year recovered part of their losses as the stock rose by 22% last week. However, total losses seen by insiders are still AU$435k since the time of purchase.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

View our latest analysis for Imdex

Imdex Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider purchase was by Non-Executive Chairman Anthony Wooles for AU$3.0m worth of shares, at about AU$2.20 per share. That means that an insider was happy to buy shares at above the current price of AU$1.89. 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. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price. We note that Anthony Wooles was both the biggest buyer and the biggest seller.

In the last twelve months insiders purchased 1.40m shares for AU$3.1m. But they sold 63.64k shares for AU$106k. In total, Imdex insiders bought more than they sold over the last year. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 1.6% of Imdex shares, worth about AU$16m. 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 Does This Data Suggest About Imdex Insiders?

It doesn't really mean much that no insider has traded Imdex shares in the last quarter. However, our analysis of transactions over the last year is heartening. Insiders do have a stake in Imdex and their transactions don't cause us concern. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. At Simply Wall St, we found 2 warning signs for Imdex that deserve your attention before buying any shares.

But note: Imdex may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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.