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Even if it's not a huge purchase, we think it was good to see that Hilton Brett, the Non-Executive Director of SomnoMed Limited (ASX:SOM) recently shelled out AU$81k to buy stock, at AU$2.33 per share. However, it only increased their shares held by 7.4%, and it wasn't a huge purchase by absolute value, either.
SomnoMed Insider Transactions Over The Last Year
Notably, that recent purchase by Hilton Brett is the biggest insider purchase of SomnoMed shares that we've seen in the last year. That means that an insider was happy to buy shares at around the current price of AU$2.35. That means they have been optimistic about the company in the past, though they may have changed their mind. We do always like to see insider buying, but it is worth noting if those purchases were made at well below today's share price, as the discount to value may have narrowed with the rising price. The good news for SomnoMed share holders is that an insider was buying at near the current price. Hilton Brett was the only individual insider to buy shares in the last twelve months.
Hilton Brett bought a total of 71.56k shares over the year at an average price of AU$2.27. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart 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.
Insider Ownership of SomnoMed
For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 8.2% of SomnoMed shares, worth about AU$16m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
So What Do The SomnoMed Insider Transactions Indicate?
It's certainly positive to see the recent insider purchase. We also take confidence from the longer term picture of insider transactions. But we don't feel the same about the fact the company is making losses. Insiders likely see value in SomnoMed shares, given these transactions (along with notable insider ownership of the company). 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: SomnoMed 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.
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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