Selling Sarytogan Graphite Shares at a Lower Price Than Current Market Value May Have Been a Costly Mistake for Insiders

Sarytogan Graphite Limited's (ASX:SGA) value has fallen 14% in the last week, but insiders who sold AU$760k worth of stock over the last year have had less success. The average selling price of AU$0.11 is still lower than the current share price, or in other words, insiders would have been better off holding on to their shares.

While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

See our latest analysis for Sarytogan Graphite

Sarytogan Graphite Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the Technical Director & Executive Director, Waldemar Mueller, sold AU$760k worth of shares at a price of AU$0.11 per share. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. It's of some comfort that this sale was conducted at a price well above the current share price, which is AU$0.086. So it is hard to draw any strong conclusion from it. The only individual insider seller over the last year was Waldemar Mueller.

You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: Most of them are flying under the radar).

Insiders At Sarytogan Graphite Have Sold Stock Recently

The last quarter saw substantial insider selling of Sarytogan Graphite shares. Specifically, Technical Director & Executive Director Waldemar Mueller ditched AU$760k worth of shares in that time, and we didn't record any purchases whatsoever. Overall this makes us a bit cautious, but it's not the be all and end all.

Insider Ownership Of Sarytogan Graphite

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. Sarytogan Graphite insiders own about AU$5.5m worth of shares (which is 43% 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 Does This Data Suggest About Sarytogan Graphite Insiders?

An insider sold Sarytogan Graphite shares recently, but they didn't buy any. And there weren't any purchases to give us comfort, over the last year. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Be aware that Sarytogan Graphite is showing 5 warning signs in our investment analysis, and 3 of those don't sit too well with us...

But note: Sarytogan Graphite 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.