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Multiple insiders bought Nine Entertainment Co. Holdings Limited (ASX:NEC) stock earlier this year, a positive sign for shareholders

When a single insider purchases stock, it is typically not a major deal. However, when multiple insiders purchase stock, like in Nine Entertainment Co. Holdings Limited's (ASX:NEC) instance, it's good news for shareholders.

While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.

Check out our latest analysis for Nine Entertainment Holdings

The Last 12 Months Of Insider Transactions At Nine Entertainment Holdings

Over the last year, we can see that the biggest insider purchase was by Non-Executive Independent Director Samantha Lewis for AU$78k worth of shares, at about AU$1.94 per share. That implies that an insider found the current price of AU$1.94 per share to be enticing. That means they have been optimistic about the company in the past, though they may have changed their mind. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. The good news for Nine Entertainment Holdings share holders is that insiders were buying at near the current price.

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While Nine Entertainment Holdings 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. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

insider-trading-volume
insider-trading-volume

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.

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company 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. Based on our data, Nine Entertainment Holdings insiders have about 0.1% of the stock, worth approximately AU$3.4m. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. I generally like to see higher levels of ownership.

So What Do The Nine Entertainment Holdings Insider Transactions Indicate?

The fact that there have been no Nine Entertainment Holdings insider transactions recently certainly doesn't bother us. However, our analysis of transactions over the last year is heartening. While we have no worries about the insider transactions, we'd be more comfortable if they owned more Nine Entertainment Holdings stock. 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. While conducting our analysis, we found that Nine Entertainment Holdings has 1 warning sign and it would be unwise to ignore it.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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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