Even if it's not a huge purchase, we think it was good to see that Karl Paganin, the Independent Non-Executive Director of Southern Cross Electrical Engineering Limited (ASX:SXE) recently shelled out AU$85k to buy stock, at AU$0.64 per share. Although the purchase is not a big one, increasing their shareholding by only 8.2%, it can be interpreted as a good sign.
Southern Cross Electrical Engineering Insider Transactions Over The Last Year
Notably, that recent purchase by Karl Paganin is the biggest insider purchase of Southern Cross Electrical Engineering shares that we've seen in the last year. That implies that an insider found the current price of AU$0.66 per share to be enticing. Of course they may have changed their mind. But this suggests they are optimistic. We do always like to see insider buying, but it is worth noting if those purchases were made at well below today's share price, as the discount to value may have narrowed with the rising price. Happily, the Southern Cross Electrical Engineering insider decided to buy shares at close to current prices. Karl Paganin 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. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Southern Cross Electrical Engineering is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. Insiders own 23% of Southern Cross Electrical Engineering shares, worth about AU$39m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
What Might The Insider Transactions At Southern Cross Electrical Engineering Tell Us?
It's certainly positive to see the recent insider purchase. We also take confidence from the longer term picture of insider transactions. Given that insiders also own a fair bit of Southern Cross Electrical Engineering we think they are probably pretty confident of a bright 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. While conducting our analysis, we found that Southern Cross Electrical Engineering has 1 warning sign and it would be unwise to ignore it.
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.
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