John McMahon Is The Non-Executive Chairman of Wellington Drive Technologies Limited (NZSE:WDT) And They Just Picked Up 14% More Shares

By
Simply Wall St
Published
November 19, 2020
NZSE:WDT
Source: Shutterstock

Investors who take an interest in Wellington Drive Technologies Limited (NZSE:WDT) should definitely note that the Non-Executive Chairman, John McMahon, recently paid NZ$0.058 per share to buy NZ$146k worth of the stock. That's a very decent purchase to our minds and it grew their holding by a solid 14%.

See our latest analysis for Wellington Drive Technologies

The Last 12 Months Of Insider Transactions At Wellington Drive Technologies

In fact, the recent purchase by John McMahon was the biggest purchase of Wellington Drive Technologies shares made by an insider individual in the last twelve months, according to our records. That implies that an insider found the current price of NZ$0.067 per share to be enticing. 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. While we always like to see insider buying, it's less meaningful if the purchases were made at much lower prices, as the opportunity they saw may have passed. Happily, the Wellington Drive Technologies insiders decided to buy shares at close to current prices.

Wellington Drive Technologies insiders may have bought shares in the last year, but they didn't sell any. 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!

insider-trading-volume
NZSE:WDT Insider Trading Volume November 19th 2020

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.

Insider Ownership

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. We usually like to see fairly high levels of insider ownership. It appears that Wellington Drive Technologies insiders own 15% of the company, worth about NZ$4.4m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

What Might The Insider Transactions At Wellington Drive Technologies Tell Us?

It's certainly positive to see the recent insider purchases. We also take confidence from the longer term picture of insider transactions. But we don't feel the same about the fact the company is making losses. Given that insiders also own a fair bit of Wellington Drive Technologies we think they are probably pretty confident of a bright future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Wellington Drive Technologies. Case in point: We've spotted 2 warning signs for Wellington Drive Technologies you should be aware of, and 1 of these is a bit unpleasant.

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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