Insiders Buying DelphX Capital Markets Might Wish They Invested More, Stock Gains 19%

Last week, DelphX Capital Markets Inc. (CVE:DELX) insiders, who had purchased shares in the previous 12 months were rewarded handsomely. The shares increased by 19% last week, resulting in a CA$4.5m increase in the company's market worth, implying a 23% gain on their initial purchase. In other words, the original CA$336.8k purchase is now worth CA$413.7k.

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.

Check out our latest analysis for DelphX Capital Markets

DelphX Capital Markets Insider Transactions Over The Last Year

The Non-Executive Independent Director Salim Hasham made the biggest insider purchase in the last 12 months. That single transaction was for CA$92k worth of shares at a price of CA$0.20 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being CA$0.15). 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. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.

In the last twelve months DelphX Capital Markets insiders were buying shares, but not selling. The average buy price was around CA$0.13. To my mind it is good that insiders have invested their own money in the company. But we must note that the investments were made at well below today's share price. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).

DelphX Capital Markets Insiders Bought Stock Recently

Over the last quarter, DelphX Capital Markets insiders have spent a meaningful amount on shares. Not only was there no selling that we can see, but they collectively bought CA$125k worth of shares. This makes one think the business has some good points.

Insider Ownership

Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. DelphX Capital Markets insiders own about CA$4.6m worth of shares. That equates to 19% 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.

What Might The Insider Transactions At DelphX Capital Markets Tell Us?

It is good to see recent purchasing. And the longer term insider transactions also give us confidence. But on the other hand, the company made a loss during the last year, which makes us a little cautious. Insiders likely see value in DelphX Capital Markets shares, given these transactions (along with notable insider ownership of the company). So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Case in point: We've spotted 5 warning signs for DelphX Capital Markets you should be aware of, and 3 of these make us uncomfortable.

But note: DelphX Capital Markets 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.