With Integrated Research Up 16%, Insider Buyers Count Their Returns

Last week, Integrated Research Limited (ASX:IRI) insiders, who had purchased shares in the previous 12 months were rewarded handsomely. The shares increased by 16% last week, resulting in a AU$23m increase in the company's market worth, implying a 154% gain on their initial purchase. As a result, their original purchase of AU$98.4k worth of stock is now worth AU$249.6k.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

See our latest analysis for Integrated Research

The Last 12 Months Of Insider Transactions At Integrated Research

Over the last year, we can see that the biggest insider purchase was by Independent Non-Executive Director Mark Ronald Brayan for AU$98k worth of shares, at about AU$0.38 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of AU$0.96. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

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!

Integrated Research is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.

Does Integrated Research Boast High Insider Ownership?

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. Integrated Research insiders own about AU$63m worth of shares. That equates to 37% 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.

So What Do The Integrated Research Insider Transactions Indicate?

It doesn't really mean much that no insider has traded Integrated Research shares in the last quarter. But insiders have shown more of an appetite for the stock, over the last year. Insiders own shares in Integrated Research and we see no evidence to suggest they are worried about the future. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. Every company has risks, and we've spotted 1 warning sign for Integrated Research 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com