Yahoo Finance Trade Alert: The Non-Executive Director Of QEM Limited (ASX:QEM), David Fitch, Has Just Spent AU$710k Buying 11% More Shares
Investors who take an interest in QEM Limited (ASX:QEM) should definitely note that the Non-Executive Director, David Fitch, recently paid AU$0.20 per share to buy AU$710k worth of the stock. That's a very decent purchase to our minds and it grew their holding by a solid 11%.
Check out our latest analysis for QEM
The Last 12 Months Of Insider Transactions At QEM
Notably, that recent purchase by David Fitch is the biggest insider purchase of QEM shares that we've seen in the last year. Even though the purchase was made at a significantly lower price than the recent price (AU$0.23), we still think insider buying is a positive. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.
In the last twelve months QEM insiders were buying shares, but not selling. They paid about AU$0.18 on average. It is certainly positive to see that insiders have invested their own money in the company. However, you should keep in mind that they bought when the share price was meaningfully below today's levels. 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 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).
Does QEM Boast High Insider Ownership?
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. QEM insiders own 53% of the company, currently worth about AU$16m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
What Might The Insider Transactions At QEM Tell Us?
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. Once you factor in the high insider ownership, it certainly seems like insiders are positive about QEM. Nice! 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. Case in point: We've spotted 4 warning signs for QEM you should be aware of, and 2 of them shouldn't be ignored.
Of course QEM may not be the best stock to buy. So you may wish to see this free collection of high quality companies.
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.
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