Insiders Buying Strategic Energy Resources Might Wish They Invested More, Stock Gains 20%

Last week, Strategic Energy Resources Limited (ASX:SER) insiders, who had purchased shares in the previous 12 months were rewarded handsomely. The shares increased by 20% last week, resulting in a AU$974k increase in the company's market worth, implying a 20% gain on their initial purchase. As a result, their original purchase of AU$200.0k worth of stock is now worth AU$240.0k.

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.

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The Last 12 Months Of Insider Transactions At Strategic Energy Resources

In the last twelve months, the biggest single purchase by an insider was when insider Graeme Kirke bought AU$200k worth of shares at a price of AU$0.005 per share. We do like to see buying, but this purchase was made at well below the current price of AU$0.006. 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.

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!

Check out our latest analysis for Strategic Energy Resources

Strategic Energy Resources 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 Strategic Energy Resources 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. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 18% of Strategic Energy Resources shares, worth about AU$1.1m. 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 Strategic Energy Resources Insiders?

It is good to see the recent insider purchase. We also take confidence from the longer term picture of insider transactions. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. Given that insiders also own a fair bit of Strategic Energy Resources we think they are probably pretty confident of a bright future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Strategic Energy Resources. Case in point: We've spotted 5 warning signs for Strategic Energy Resources you should be aware of.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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.