Insiders Who Sold Jaxsta Made The Right Call As Market Cap Slides By AU$4.2m

Insiders at Jaxsta Limited (ASX:JXT) sold AU$456k worth of stock at an average price of AU$0.019 a share over the past year, making the most of their investment. The company’s market cap plunged by AU$4.2m after price dropped by 12% last week but insiders were able to limit their loss to an extent.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

See our latest analysis for Jaxsta

Jaxsta Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider purchase was by Independent Non Executive Director Robert Gaunt for AU$362k worth of shares, at about AU$0.04 per share. Even though the purchase was made at a significantly lower price than the recent price (AU$0.053), we still think insider buying is a positive. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.

Over the last year we saw more insider selling of Jaxsta shares, than buying. 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 growing companies that insiders are buying.

Insider Ownership

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 23% of Jaxsta shares, worth about AU$7.4m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Do The Jaxsta Insider Transactions Indicate?

It doesn't really mean much that no insider has traded Jaxsta shares in the last quarter. Still, the insider transactions at Jaxsta in the last 12 months are not very heartening. The modest level of insider ownership is, at least, some comfort. While we like knowing 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 5 warning signs for Jaxsta (of which 4 are potentially serious!) you should know about.

Of course Jaxsta may not be the best stock to buy. So you may wish to see this free collection of high quality 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.