Cluey's Recent Gains Improve Losses On Insider Purchases Worth AU$995.4k
Insiders who purchased AU$995.4k worth of Cluey Ltd (ASX:CLU) shares over the past year recouped some of their losses after price gained 10.0% last week. However, total losses seen by insiders are still AU$815k since the time of purchase.
While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.
Cluey Insider Transactions Over The Last Year
The Co-Founder Mark Rohald made the biggest insider purchase in the last 12 months. That single transaction was for AU$676k worth of shares at a price of AU$0.07 each. That means that even when the share price was higher than AU$0.011 (the recent price), an insider wanted to purchase shares. It's very possible they regret the purchase, but it's more likely they are bullish about the company. To us, it's very important to consider the price insiders pay for shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.
While Cluey insiders bought shares during the last year, they didn't sell. The average buy price was around AU$0.061. These transactions suggest that insiders have considered the current price attractive. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Check out our latest analysis for Cluey
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.
Cluey Insiders Bought Stock Recently
We saw some Cluey insider buying shares in the last three months. Co-Founder Mark Rohald shelled out AU$21k for shares in that time. It's great to see that insiders are only buying, not selling. But in this case the amount purchased means the recent transaction may not be very meaningful on its own.
Does Cluey 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. I reckon it's a good sign if insiders own a significant number of shares in the company. It appears that Cluey insiders own 38% of the company, worth about AU$1.7m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
What Might The Insider Transactions At Cluey Tell Us?
Insider purchases may have been minimal, in the last three months, but there was no selling at all. The net investment is not enough to encourage us much. On a brighter note, the transactions over the last year are encouraging. Insiders do have a stake in Cluey and their transactions don't cause us concern. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. To that end, you should learn about the 5 warning signs we've spotted with Cluey (including 4 which are potentially serious).
Of course Cluey may not be the best stock to buy. So you may wish to see this free collection of high quality 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.