Yahoo Finance Need To Know: Macmahon Holdings Limited (ASX:MAH) Insiders Have Been Buying Shares
We often see insiders buying up shares in companies that perform well over the long term. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So shareholders might well want to know whether insiders have been buying or selling shares in Macmahon Holdings Limited (ASX:MAH).
What Is Insider Selling?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock in the company. However, rules govern insider transactions, and certain disclosures are required.
Insider transactions are not the most important thing when it comes to long-term investing. But it is perfectly logical to keep tabs on what insiders are doing. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.
View our latest analysis for Macmahon Holdings
Macmahon Holdings Insider Transactions Over The Last Year
Notably, that recent purchase by Bruce Munro is the biggest insider purchase of Macmahon Holdings shares that we've seen in the last year. That means that even when the share price was higher than AU$0.24 (the recent price), an insider wanted to purchase shares. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. To us, it's very important to consider the price insiders pay for shares is very important. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.
While Macmahon Holdings insiders bought shares last year, they didn't sell. You can see a visual depiction of insider transactions (by 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 plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
Insiders at Macmahon Holdings Have Bought Stock Recently
Over the last quarter, Macmahon Holdings insiders have spent a meaningful amount on shares. Not only was there no selling that we can see, but they collectively bought AU$158k worth of shares. That shows some optimism about the company's future.
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. Our data indicates that Macmahon Holdings insiders own about AU$8.7m worth of shares (which is 1.7% of the company). But they may have an indirect interest through a corporate structure that we haven't picked up on. We do generally prefer see higher levels of insider ownership.
What Might The Insider Transactions At Macmahon Holdings Tell Us?
It is good to see recent purchasing. And the longer term insider transactions also give us confidence. While the overall levels of insider ownership are below what we'd like to see, the history of transactions imply that Macmahon Holdings insiders are reasonably well aligned, and optimistic for the future. If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.
But note: Macmahon Holdings 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.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.
