Kevin Smith Bought 1,193% More Shares In IRIS Metals

Investors who take an interest in IRIS Metals Limited (ASX:IR1) should definitely note that the Non-Executive Director, Kevin Smith, recently paid AU$0.25 per share to buy AU$375k worth of the stock. We reckon that's a good sign, especially since the purchase boosted their holding by 1,193%.

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

The Last 12 Months Of Insider Transactions At IRIS Metals

Notably, that recent purchase by Kevin Smith is the biggest insider purchase of IRIS Metals shares that we've seen in the last year. That means that an insider was happy to buy shares at above the current price of AU$0.16. 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. To us, it's very important to consider the price insiders pay for shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.

In the last twelve months insiders purchased 1.98m shares for AU$471k. But they sold 1.00m shares for AU$200k. In the last twelve months there was more buying than selling by IRIS Metals insiders. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

View our latest analysis for IRIS Metals

IRIS Metals 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 IRIS Metals Boast High 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. We usually like to see fairly high levels of insider ownership. Insiders own 31% of IRIS Metals shares, worth about AU$8.9m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Do The IRIS Metals Insider Transactions Indicate?

The recent insider purchases are heartening. We also take confidence from the longer term picture of insider transactions. But we don't feel the same about the fact the company is making losses. Given that insiders also own a fair bit of IRIS Metals we think they are probably pretty confident of a bright 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. Every company has risks, and we've spotted 5 warning signs for IRIS Metals (of which 3 are significant!) you should know about.

Of course IRIS Metals 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.

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.