Insider Sellers Might Regret Selling DUG Technology Shares at a Lower Price Than Current Market Value

DUG Technology Ltd's (ASX:DUG) stock price has dropped 11% in the previous week, but insiders who sold US$9.4m in stock over the past year have had less luck. Insiders would probably have been better off holding on to their shares given that the average selling price of US$1.97 is still lower than the current share price.

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.

View our latest analysis for DUG Technology

DUG Technology Insider Transactions Over The Last Year

The insider, Sheila Lamont, made the biggest insider sale in the last 12 months. That single transaction was for AU$4.6m worth of shares at a price of AU$1.85 each. 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$1.66. So it is hard to draw any strong conclusion from it.

In the last twelve months insiders purchased 248.64k shares for AU$416k. On the other hand they divested 4.78m shares, for AU$9.4m. Over the last year we saw more insider selling of DUG Technology shares, than buying. 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!

For those who like to find hidden gems this free list of small cap companies with recent insider purchasing, could be just the ticket.

Insider Ownership Of DUG Technology

For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. DUG Technology insiders own about AU$53m worth of shares. That equates to 24% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

What Might The Insider Transactions At DUG Technology Tell Us?

The fact that there have been no DUG Technology insider transactions recently certainly doesn't bother us. Our analysis of DUG Technology insider transactions leaves us cautious. But it's good to see that insiders own shares in the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing DUG Technology. For example, DUG Technology has 3 warning signs (and 1 which shouldn't be ignored) we think you should know about.

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.