Reversal Of Fortune For Danavation Technologies Insiders Who Made A CA$1.02m Purchase

Some of the losses seen by insiders who purchased CA$1.02m worth of Danavation Technologies Corp. (CSE:DVN) shares over the past year were recovered after the stock increased by 13% over the past week. The purchase, however, has proven to be a pricey bet, with losses currently totalling CA$788k.

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.

View our latest analysis for Danavation Technologies

Danavation Technologies Insider Transactions Over The Last Year

The insider Terence Harvey made the biggest insider purchase in the last 12 months. That single transaction was for CA$1.0m 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$0.045). It's very possible they regret the purchase, but it's more likely they are bullish about the company. To us, it's very important to consider the price insiders pay for shares. It is encouraging to see an insider paid above the current price for shares, as it suggests they saw value, even at higher levels. The only individual insider to buy over the last year was Terence Harvey.

Terence Harvey bought a total of 5.08m shares over the year at an average price of CA$0.20. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

Danavation Technologies is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Insider Ownership Of Danavation Technologies

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. Danavation Technologies insiders own about CA$1.9m worth of shares (which is 45% 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 Do The Danavation Technologies Insider Transactions Indicate?

It doesn't really mean much that no insider has traded Danavation Technologies 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 Danavation Technologies insiders are reasonably well aligned (owning significant chunk of the company's shares) and optimistic for the future. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For example, Danavation Technologies has 6 warning signs (and 3 which make us uncomfortable) we think you should know about.

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 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.