Gerald Harvey Is The Co-Founder of Harvey Norman Holdings Limited (ASX:HVN) And Just Spent AU$998k On Shares

By
Simply Wall St
Published
September 28, 2021
ASX:HVN
Source: Shutterstock

Harvey Norman Holdings Limited (ASX:HVN) shareholders (or potential shareholders) will be happy to see that the Co-Founder, Gerald Harvey, recently bought a whopping AU$998k worth of stock, at a price of AU$4.99. While that only increased their holding size by 0.05%, it is still a big swing by our standards.

Check out our latest analysis for Harvey Norman Holdings

The Last 12 Months Of Insider Transactions At Harvey Norman Holdings

In fact, the recent purchase by Gerald Harvey was the biggest purchase of Harvey Norman Holdings shares made by an insider individual in the last twelve months, according to our records. That means that an insider was happy to buy shares at above the current price of AU$4.94. It's very possible they regret the purchase, but it's more likely they are bullish about the company. In our view, the price an insider pays for shares is very important. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.

While Harvey Norman Holdings insiders bought shares during the last year, they didn't sell. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

insider-trading-volume
ASX:HVN Insider Trading Volume September 28th 2021

There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).

Insider Ownership

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. Harvey Norman Holdings insiders own 41% of the company, currently worth about AU$2.5b based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Do The Harvey Norman Holdings Insider Transactions Indicate?

It's certainly positive to see the recent insider purchases. And the longer term insider transactions also give us confidence. When combined with notable insider ownership, these factors suggest Harvey Norman Holdings insiders are well aligned, and quite possibly think the share price is too low. Looks promising! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Harvey Norman Holdings. At Simply Wall St, we've found that Harvey Norman Holdings has 2 warning signs (1 is a bit unpleasant!) that deserve your attention before going any further with your analysis.

But note: Harvey Norman Holdings 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, but not derivative transactions.

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