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Quite a few insiders have dramatically grown their holdings in Whitehaven Coal Limited (ASX:WHC) over the past 12 months. An insider's optimism about the company's prospects is a positive sign.
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 Whitehaven Coal
The Last 12 Months Of Insider Transactions At Whitehaven Coal
The Non-Executive Director George Raymond Zage made the biggest insider purchase in the last 12 months. That single transaction was for AU$1.0m worth of shares at a price of AU$7.59 each. That means that an insider was happy to buy shares at above the current price of AU$7.24. 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.
Over the last year, we can see that insiders have bought 180.50k shares worth AU$1.4m. But insiders sold 20.00k shares worth AU$212k. Overall, Whitehaven Coal insiders were net buyers during the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Whitehaven Coal is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Insiders At Whitehaven Coal Have Bought Stock Recently
Over the last three months, we've seen significant insider buying at Whitehaven Coal. In total, insiders bought AU$250k worth of shares in that time, and we didn't record any sales whatsoever. This is a positive in our book as it implies some confidence.
Does Whitehaven Coal Boast High Insider Ownership?
Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Whitehaven Coal insiders own about AU$130m worth of shares. That equates to 2.1% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
What Might The Insider Transactions At Whitehaven Coal Tell Us?
It is good to see recent purchasing. We also take confidence from the longer term picture of insider transactions. Once you factor in the high insider ownership, it certainly seems like insiders are positive about Whitehaven Coal. One for the watchlist, at least! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For instance, we've identified 2 warning signs for Whitehaven Coal (1 is potentially serious) you should be aware of.