Stock Analysis

Comms Group Limited (ASX:CCG) insiders recover some losses but still AU$78k away from matching original investment

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Insiders who purchased AU$463k worth of Comms Group Limited (ASX:CCG) shares over the past year recouped some of their losses after price gained 11% last week. However, total losses seen by insiders are still AU$78k since the time of purchase.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

Check out our latest analysis for Comms Group

The Last 12 Months Of Insider Transactions At Comms Group

Over the last year, we can see that the biggest insider purchase was by Group CEO Peter McGrath for AU$394k worth of shares, at about AU$0.089 per share. That means that an insider was happy to buy shares at above the current price of AU$0.072. Their view may have changed since then, but at least it shows they felt optimistic at the time. We always take careful note of the price insiders pay when purchasing shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.

Comms Group insiders may have bought shares in the last year, but they didn't sell any. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

ASX:CCG Insider Trading Volume March 16th 2023

Comms Group is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

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. A high insider ownership often makes company leadership more mindful of shareholder interests. It's great to see that Comms Group insiders own 45% of the company, worth about AU$12m. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Do The Comms Group Insider Transactions Indicate?

It doesn't really mean much that no insider has traded Comms Group shares in the last quarter. But insiders have shown more of an appetite for the stock, over the last year. It would be great to see more insider buying, but overall it seems like Comms Group insiders are reasonably well aligned (owning significant chunk of the company's shares) and optimistic for the future. 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. For example - Comms Group has 4 warning signs we think you should be aware of.

But note: Comms Group 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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