We often see insiders buying up shares in companies that perform well over the long term. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So shareholders might well want to know whether insiders have been buying or selling shares in Bod Australia Limited (ASX:BDA).
What Is Insider Selling?
It’s quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, rules govern insider transactions, and certain disclosures are required.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But it is perfectly logical to keep tabs on what insiders are doing. For example, a Columbia University study found that ‘insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers’.
Bod Australia Insider Transactions Over The Last Year
While there weren’t any large insider transactions in the last twelve months, it’s still worth looking at the trading.
Over the last year, we can see that insiders have bought 145.00k shares worth AU$71k. In the last twelve months there was more buying than selling by Bod Australia insiders. They paid about AU$0.49 on average. These transactions show that insiders have confidence to invest their own money in the stock, albeit at slightly below the recent price of AU$0.50. You can see the insider transactions (by 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!
Bod Australia is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Bod Australia Insiders Bought Stock Recently
It’s good to see that Bod Australia insiders have made notable investments in the company’s shares. Overall, 3 insiders shelled out AU$71k for shares in the company — and none sold. That shows some optimism about the company’s future.
Many investors like to check how much of a company is owned by insiders. 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 appears that Bod Australia insiders own 27% of the company, worth about AU$9.0m. We’ve certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
So What Do The Bod Australia Insider Transactions Indicate?
The recent insider purchases are heartening. 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. When combined with notable insider ownership, these factors suggest Bod Australia insiders are well aligned, and that they may think the share price is too low. Along with insider transactions, I recommend checking if Bod Australia is growing revenue. This free chart of historic revenue and earnings should make that easy.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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