Nanoveu Insider Confidence Rewarded, Stock Hits AU$52m Market Cap

Nanoveu Limited (ASX:NVU) insiders who purchased shares in the last 12 months were richly rewarded last week. The stock climbed by 28% resulting in a AU$11m addition to the company’s market value. Put another way, the original AU$347.6k acquisition is now worth AU$763.4k.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.

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Nanoveu Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider purchase was by Executive Chairman David Pevcic for AU$300k worth of shares, at about AU$0.026 per share. We do like to see buying, but this purchase was made at well below the current price of AU$0.059. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

David Pevcic bought 12.94m shares over the last 12 months at an average price of AU$0.027. 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!

View our latest analysis for Nanoveu

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.

Does Nanoveu 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. Nanoveu insiders own about AU$17m worth of shares. That equates to 33% of the company. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Do The Nanoveu Insider Transactions Indicate?

There haven't been any insider transactions in the last three months -- that doesn't mean much. However, our analysis of transactions over the last year is heartening. Insiders do have a stake in Nanoveu and their transactions don't cause us concern. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Be aware that Nanoveu is showing 5 warning signs in our investment analysis, and 3 of those don't sit too well with us...

But note: Nanoveu 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.