Independent Director of ALM Equity Picks Up 2.3% More Stock

Even if it's not a huge purchase, we think it was good to see that Johan Unger, the Independent Director of ALM Equity AB (publ) (STO:ALM) recently shelled out kr707k to buy stock, at kr199 per share. However, it only increased their shares held by 2.3%, and it wasn't a huge purchase by absolute value, either.

Check out our latest analysis for ALM Equity

The Last 12 Months Of Insider Transactions At ALM Equity

In the last twelve months, the biggest single purchase by an insider was when Founder Joakim Alm bought kr2.6m worth of shares at a price of kr198 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being kr192). 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. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels. Notably Joakim Alm was also the biggest seller.

Over the last year, we can see that insiders have bought 16.55k shares worth kr3.3m. On the other hand they divested 13.00k shares, for kr2.6m. In total, ALM Equity 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 click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

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

Does ALM Equity Boast High 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. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It's great to see that ALM Equity insiders own 57% of the company, worth about kr1.3b. 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 ALM Equity Insider Transactions Indicate?

It's certainly positive to see the recent insider purchases. And the longer term insider transactions also give us confidence. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. Once you factor in the high insider ownership, it certainly seems like insiders are positive about ALM Equity. Nice! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Be aware that ALM Equity is showing 2 warning signs in our investment analysis, and 1 of those doesn't sit too well with us...

But note: ALM Equity may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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.