Insiders of Nufarm Limited (ASX:NUF) received good value on their investment after their AU$1.2m purchase jumped AU$163k in value

Last week, Nufarm Limited (ASX:NUF) insiders, who had purchased shares in the previous 12 months were rewarded handsomely. The shares increased by 6.4% last week, resulting in a AU$106m increase in the company's market worth. As a result, the stock they originally bought for AU$1.2m is now worth AU$1.3m.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

Check out our latest analysis for Nufarm

Nufarm Insider Transactions Over The Last Year

The Independent Non-Executive Chairman John Gillam made the biggest insider purchase in the last 12 months. That single transaction was for AU$746k worth of shares at a price of AU$4.07 each. We do like to see buying, but this purchase was made at well below the current price of AU$4.67. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.

Nufarm insiders may have bought shares in the last year, but they didn't sell any. 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!

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

Insiders at Nufarm Have Bought Stock Recently

Over the last three months, we've seen significant insider buying at Nufarm. In total, insiders bought AU$178k worth of shares in that time, and we didn't record any sales whatsoever. That shows some optimism about the company's future.

Does Nufarm Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. It appears that Nufarm insiders own 6.2% of the company, worth about AU$109m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

What Might The Insider Transactions At Nufarm Tell Us?

It's certainly positive to see the recent insider purchases. And the longer term insider transactions also give us confidence. But we don't feel the same about the fact the company is making losses. Along with the high insider ownership, this analysis suggests that insiders are quite bullish about Nufarm. Looks promising! If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

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, but not derivative transactions.

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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.
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