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Last week, Prospa Group Limited (ASX:PGL) insiders, who had purchased shares in the previous 12 months were rewarded handsomely. The shares increased by 17% last week, resulting in a AU$21m increase in the company's market worth. In other words, the original AU$194k purchase is now worth AU$219k.
Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.
Prospa Group Insider Transactions Over The Last Year
The Non-Executive Director Aviad Eyal made the biggest insider purchase in the last 12 months. That single transaction was for AU$100k worth of shares at a price of AU$0.80 each. We do like to see buying, but this purchase was made at well below the current price of AU$0.90. 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 Prospa Group 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!
Prospa Group 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.
Insiders at Prospa Group Have Bought Stock Recently
Over the last quarter, Prospa Group insiders have spent a meaningful amount on shares. Not only was there no selling that we can see, but they collectively bought AU$150k worth of shares. This is a positive in our book as it implies some confidence.
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. I reckon it's a good sign if insiders own a significant number of shares in the company. It's great to see that Prospa Group insiders own 58% of the company, worth about AU$85m. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
So What Do The Prospa Group Insider Transactions Indicate?
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. Along with the high insider ownership, this analysis suggests that insiders are quite bullish about Prospa Group. That's what I like to see! Of course, the future is what matters most. So if you are interested in Prospa Group, you should check out this free report on analyst forecasts for the company.
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.