Insiders who purchased Hampton Financial Corporation (CVE:HFC) earlier this year lose an additional CA$174k as the stock sinks to CA$0.38

Insiders who acquired CA$435k worth of Hampton Financial Corporation's (CVE:HFC) stock at an average price of CA$0.63 in the past 12 months may be dismayed by the recent 16% price decline. Insiders buy with the expectation to see their investments rise in value over a period of time. However, recent losses have rendered their above investment worth CA$261k which is not ideal.

Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.

Check out our latest analysis for Hampton Financial

Hampton Financial Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider purchase was by Executive Chairman & CEO Peter Deeb for CA$350k worth of shares, at about CA$0.70 per share. That means that an insider was happy to buy shares at above the current price of CA$0.38. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. To us, it's very important to consider the price insiders pay for shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.

In the last twelve months Hampton Financial insiders were buying shares, but not selling. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).

Insiders At Hampton Financial Have Bought Stock Recently

Over the last three months, we've seen significant insider buying at Hampton Financial. In total, insiders bought CA$394k worth of shares in that time, and we didn't record any sales whatsoever. This could be interpreted as suggesting a positive outlook.

Insider Ownership Of Hampton Financial

For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Hampton Financial insiders own about CA$7.2m worth of shares (which is 61% of the company). 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 Hampton Financial Insider Transactions Indicate?

It is good to see recent purchasing. We also take confidence from the longer term picture of insider transactions. Along with the high insider ownership, this analysis suggests that insiders are quite bullish about Hampton Financial. Nice! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Hampton Financial. Our analysis shows 7 warning signs for Hampton Financial (3 are concerning!) and we strongly recommend you look at these before investing.

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, but not derivative transactions.

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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.