Favourable Signals For Ondo InsurTech: Numerous Insiders Acquired Stock

It is usually uneventful when a single insider buys stock. However, When quite a few insiders buy shares, as it happened in Ondo InsurTech Plc's (LON:ONDO) case, it's fantastic news for shareholders.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

Check out our latest analysis for Ondo InsurTech

Ondo InsurTech Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when Non-Executive Chairman Gregory Wood bought UK£49k worth of shares at a price of UK£0.15 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being UK£0.15). 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. 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.

Over the last year, we can see that insiders have bought 510.80k shares worth UK£75k. On the other hand they divested 137.93k shares, for UK£20k. In total, Ondo InsurTech insiders bought more than they sold over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

Ondo InsurTech is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.

Insider Ownership

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. Our data indicates that Ondo InsurTech insiders own about UK£2.5m worth of shares (which is 14% of the company). However, it's possible that insiders might have an indirect interest through a more complex structure. Whilst better than nothing, we're not overly impressed by these holdings.

So What Does This Data Suggest About Ondo InsurTech Insiders?

Insider buying and selling have balanced each other out in the last three months, so we can't deduct anything useful from these recent trades. But insiders have shown more of an appetite for the stock, over the last year. We'd like to see bigger individual holdings. However, we don't see anything to make us think Ondo InsurTech insiders are doubting the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Ondo InsurTech. Be aware that Ondo InsurTech is showing 4 warning signs in our investment analysis, and 1 of those is concerning...

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.