Yahoo Finance Insiders who bought into Australian Clinical Labs Limited (ASX:ACL) earlier this year might wish they'd invested more as stock gained 8.7%
Insiders who bought Australian Clinical Labs Limited (ASX:ACL) stock in the last 12 months were richly rewarded last week. The company's market value increased by AU$90m as a result of the stock's 8.7% gain over the same period. Put another way, the original AU$511k acquisition is now worth AU$590k.
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.
Check out our latest analysis for Australian Clinical Labs
Australian Clinical Labs Insider Transactions Over The Last Year
The CEO & Executive Director Melinda McGrath made the biggest insider purchase in the last 12 months. That single transaction was for AU$335k worth of shares at a price of AU$5.06 each. We do like to see buying, but this purchase was made at well below the current price of AU$5.64. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.
While Australian Clinical Labs insiders bought shares during the last year, they didn't sell. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).
Insiders at Australian Clinical Labs Have Bought Stock Recently
It's good to see that Australian Clinical Labs insiders have made notable investments in the company's shares. Not only was there no selling that we can see, but they collectively bought AU$412k worth of shares. This makes one think the business has some good points.
Does Australian Clinical Labs Boast High Insider Ownership?
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with 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. Insiders own 4.6% of Australian Clinical Labs shares, worth about AU$53m. 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 Does This Data Suggest About Australian Clinical Labs Insiders?
It's certainly positive to see the recent insider purchases. We also take confidence from the longer term picture of insider transactions. Insiders likely see value in Australian Clinical Labs shares, given these transactions (along with notable insider ownership of the company). 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. Case in point: We've spotted 2 warning signs for Australian Clinical Labs you should be aware of, and 1 of these is potentially serious.
Of course Australian Clinical Labs 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, 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.
