Insiders Rewarded With US$222k Addition To Investment As Petra Diamonds Stock Hits UK£62m

Petra Diamonds Limited (LON:PDL) insiders who purchased shares in the last 12 months were richly rewarded last week. The stock climbed by 13% resulting in a UK£7.2m addition to the company’s market value. Put another way, the original US$1.44m acquisition is now worth US$1.66m.

While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

Check out our latest analysis for Petra Diamonds

Petra Diamonds Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when insider Jose Gomez bought UK£1.1m worth of shares at a price of UK£0.27 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of UK£0.32. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

While Petra Diamonds insiders bought shares during the last year, they didn't sell. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

Petra Diamonds is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.

Petra Diamonds Insiders Bought Stock Recently

It's good to see that Petra Diamonds insiders have made notable investments in the company's shares. insider Jose Gomez spent UK£269k on stock, and there wasn't any selling. This is a positive in our book as it implies some confidence.

Insider Ownership Of Petra Diamonds

For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Petra Diamonds insiders own about UK£15m worth of shares. That equates to 24% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Do The Petra Diamonds Insider Transactions Indicate?

The recent insider purchase is heartening. 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. Insiders likely see value in Petra Diamonds shares, given these transactions (along with notable insider ownership of the company). In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Petra Diamonds. At Simply Wall St, we've found that Petra Diamonds has 3 warning signs (1 shouldn't be ignored!) that deserve your attention before going any further with your analysis.

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.