Radius Residential Care Insiders NZ$1.5m Short Of Breakeven On Stock Purchase

Insiders who purchased NZ$5.0m worth of Radius Residential Care Limited (NZSE:RAD) shares over the past year recouped some of their losses after price gained 15% last week. The purchase, however, has proven to be a pricey bet, with losses currently totalling NZ$1.5m.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

See our latest analysis for Radius Residential Care

The Last 12 Months Of Insider Transactions At Radius Residential Care

Over the last year, we can see that the biggest insider purchase was by insider Jamie Main for NZ$5.0m worth of shares, at about NZ$0.33 per share. That means that an insider was happy to buy shares at above the current price of NZ$0.23. It's very possible they regret the purchase, but it's more likely they are bullish about the company. We always take careful note of the price insiders pay when purchasing shares. As a general rule, we feel more positive about a stock when an insider has bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price. Jamie Main was the only individual insider to buy during the last year.

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!

There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).

Does Radius Residential Care Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. It's great to see that Radius Residential Care insiders own 56% of the company, worth about NZ$37m. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Do The Radius Residential Care Insider Transactions Indicate?

It doesn't really mean much that no insider has traded Radius Residential Care shares in the last quarter. However, our analysis of transactions over the last year is heartening. Judging from their transactions, and high insider ownership, Radius Residential Care insiders feel good about the company's 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. To help with this, we've discovered 5 warning signs (3 are significant!) that you ought to be aware of before buying any shares in Radius Residential Care.

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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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.