A number of insiders bought Matrix Composites & Engineering Ltd (ASX:MCE) stock last year, which is great news for shareholders
Usually, when one insider buys stock, it might not be a monumental event. But when multiple insiders are buying like they did in the case of Matrix Composites & Engineering Ltd (ASX:MCE), that sends out a positive message to the company's shareholders.
While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
View our latest analysis for Matrix Composites & Engineering
Matrix Composites & Engineering Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider sale was by the insider, Vasilios Piperoglou, for AU$103k worth of shares, at about AU$0.14 per share. That means that even when the share price was below the current price of AU$0.15, an insider wanted to cash in some shares. We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. It is worth noting that this sale was only 13% of Vasilios Piperoglou's holding. Vasilios Piperoglou was the only individual insider to sell over the last year.
Over the last year, we can see that insiders have bought 1.13m shares worth AU$180k. But they sold 707.29k shares for AU$103k. In total, Matrix Composites & Engineering insiders bought more than they sold over the last year. 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 always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).
Insiders at Matrix Composites & Engineering Have Bought Stock Recently
It's good to see that Matrix Composites & Engineering insiders have made notable investments in the company's shares. Overall, four insiders shelled out AU$180k for shares in the company -- and none sold. That shows some optimism about the company's future.
Does Matrix Composites & Engineering Boast High Insider Ownership?
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 Matrix Composites & Engineering insiders own 44% of the company, worth about AU$9.6m. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
So What Do The Matrix Composites & Engineering Insider Transactions Indicate?
It is good to see recent purchasing. And an analysis of the transactions over the last year also gives us confidence. But we don't feel the same about the fact the company is making losses. When combined with notable insider ownership, these factors suggest Matrix Composites & Engineering insiders are well aligned, and quite possibly think the share price is too low. That's what I like to see! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Case in point: We've spotted 5 warning signs for Matrix Composites & Engineering you should be aware of, and 2 of them are a bit concerning.
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.