Yahoo Finance Quite a few insiders invested in Macmahon Holdings Limited (ASX:MAH) last year which is positive 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 Macmahon Holdings Limited (ASX:MAH), 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 Macmahon Holdings
The Last 12 Months Of Insider Transactions At Macmahon Holdings
The Independent Non-Executive Director Bruce Munro made the biggest insider purchase in the last 12 months. That single transaction was for AU$99k worth of shares at a price of AU$0.20 each. That means that an insider was happy to buy shares at above the current price of AU$0.17. Their view may have changed since then, but at least it shows they felt optimistic at the time. To us, it's very important to consider the price insiders pay for shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.
While Macmahon Holdings insiders bought shares during the last year, they didn't sell. The average buy price was around AU$0.22. These transactions suggest that insiders have considered the current price attractive. 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!
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
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. From our data, it seems that Macmahon Holdings insiders own 2.1% of the company, worth about AU$7.3m. However, it's possible that insiders might have an indirect interest through a more complex structure. Whilst better than nothing, we're not overly impressed by these holdings.
So What Does This Data Suggest About Macmahon Holdings Insiders?
It doesn't really mean much that no insider has traded Macmahon Holdings shares in the last quarter. On a brighter note, the transactions over the last year are encouraging. The transactions are fine but it'd be more encouraging if Macmahon Holdings insiders bought more shares in the company. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. To that end, you should learn about the 2 warning signs we've spotted with Macmahon Holdings (including 1 which is 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.
