Insiders Buying Strategem Capital Might Wish They Invested More, Stock Gains 11%

Strategem Capital Corporation (CVE:SGE) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 11%, resulting in a CA$273k rise in the company's market capitalisation, translating to a gain of 11% on their initial investment. As a result, the stock they originally bought for CA$370.1k is now worth CA$411.2k.

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.

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The Last 12 Months Of Insider Transactions At Strategem Capital

In the last twelve months, the biggest single purchase by an insider was when insider James Flatt bought CA$370k worth of shares at a price of CA$0.27 per share. Even though the purchase was made at a significantly lower price than the recent price (CA$0.30), 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.

The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

Check out our latest analysis for Strategem Capital

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).

Does Strategem Capital Boast High 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. Strategem Capital insiders own about CA$1.6m worth of shares (which is 64% of the company). I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Does This Data Suggest About Strategem Capital Insiders?

It is good to see the recent insider purchase. We also take confidence from the longer term picture of insider transactions. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. When combined with notable insider ownership, these factors suggest Strategem Capital insiders are well aligned, and quite possibly think the share price is too low. Nice! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Strategem Capital. You'd be interested to know, that we found 4 warning signs for Strategem Capital and we suggest you have a look.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.