Insiders Sold AU$1.6m Of Ovanti Stock Possibly Sending Warning Sign

Last week, Ovanti Limited's (ASX:OVT) stock jumped 43%, but insiders who sold AU$1.6m worth of stock in over the past year are likely to be in a better position. Selling at an average price of AU$0.036, which is higher than the current price might have been the right call as holding on to stock would have meant their investment would be worth less now than it was at the time of sale.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

See our latest analysis for Ovanti

The Last 12 Months Of Insider Transactions At Ovanti

Notably, that recent sale by Daler Fayziev is the biggest insider sale of Ovanti shares that we've seen in the last year. While we don't usually like to see insider selling, it's more concerning if the sales take place 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$0.03. So it may not shed much light on insider confidence at current levels.

You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

If you are like me, then you will not want to miss this free list of small cap stocks that are not only being bought by insiders but also have attractive valuations.

Insiders At Ovanti Have Sold Stock Recently

Over the last three months, we've seen notably more insider selling, than insider buying, at Ovanti. In that time, Executive Director Daler Fayziev dumped AU$1.6m worth of shares. On the flip side, Executive Director Daler Fayziev spent AU$512k on purchasing shares (as mentioned above) . The share price has moved a bit recently, but it's hard to argue that the selling is a positive.

Insider Ownership Of Ovanti

Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. Insiders own 37% of Ovanti shares, worth about AU$17m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

What Might The Insider Transactions At Ovanti Tell Us?

The stark truth for Ovanti is that there has been more insider selling than insider buying in the last three months. Zooming out, the longer term picture doesn't give us much comfort. Insiders own shares, but we're still pretty cautious, given the history of sales. We'd practice some caution before buying! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Ovanti. To that end, you should learn about the 6 warning signs we've spotted with Ovanti (including 3 which are a bit concerning).

But note: Ovanti 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.