Yahoo Finance Insiders who bought Iluka Resources Limited (ASX:ILU) last year must be regretting not buying more as market cap hits AU$4.9b
Iluka Resources Limited (ASX:ILU) insiders who purchased shares in the last 12 months were richly rewarded last week. The stock climbed by 4.7% resulting in a AU$218m addition to the company’s market value. As a result, their original purchase of AU$191k worth of stock is now worth AU$244k.
Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.
View our latest analysis for Iluka Resources
The Last 12 Months Of Insider Transactions At Iluka Resources
In the last twelve months, the biggest single purchase by an insider was when Independent Non-Executive Chairman Robert Cole bought AU$131k worth of shares at a price of AU$8.71 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of AU$11.60. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.
While Iluka Resources 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 click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Iluka Resources 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.
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. We usually like to see fairly high levels of insider ownership. Iluka Resources insiders own about AU$25m worth of shares. That equates to 0.5% of the company. 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 Iluka Resources Insiders?
It doesn't really mean much that no insider has traded Iluka Resources shares in the last quarter. On a brighter note, the transactions over the last year are encouraging. Insiders do have a stake in Iluka Resources and their transactions don't cause us concern. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Iluka Resources. While conducting our analysis, we found that Iluka Resources has 1 warning sign and it would be unwise to ignore this.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.
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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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