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Bullish insiders bet AU$778k on QEM Limited (ASX:QEM)

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When a single insider purchases stock, it is typically not a major deal. However, when multiple insiders purchase stock, like in QEM Limited's (ASX:QEM) instance, it's good news for shareholders.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

View our latest analysis for QEM

The Last 12 Months Of Insider Transactions At QEM

The Non-Executive Director David Fitch made the biggest insider purchase in the last 12 months. That single transaction was for AU$580k worth of shares at a price of AU$0.15 each. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of AU$0.19. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

While QEM insiders bought shares during the last year, they didn't sell. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

insider-trading-volume
insider-trading-volume

QEM is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

QEM Insiders Bought Stock Recently

Over the last quarter, QEM insiders have spent a meaningful amount on shares. In total, insiders bought AU$106k worth of shares in that time, and we didn't record any sales whatsoever. This makes one think the business has some good points.

Does QEM Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. QEM insiders own 52% of the company, currently worth about AU$12m based on the recent share price. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

What Might The Insider Transactions At QEM 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 on the other hand, the company made a loss during the last year, which makes us a little cautious. When combined with notable insider ownership, these factors suggest QEM insiders are well aligned, and quite possibly think the share price is too low. Looks promising! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing QEM. Case in point: We've spotted 5 warning signs for QEM you should be aware of, and 2 of these are a bit concerning.

But note: QEM 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, but not derivative transactions.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.

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