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When a single insider purchases stock, it is typically not a major deal. However, when multiple insiders purchase stock, like in Altona Rare Earths Plc's (LON:REE) instance, it's good news for shareholders.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.
View our latest analysis for Altona Rare Earths
The Last 12 Months Of Insider Transactions At Altona Rare Earths
Notably, that recent purchase by Louise Adrian is the biggest insider purchase of Altona Rare Earths 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 UK£0.016. That means they have been optimistic about the company in the past, though they may have changed their mind. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. Happily, the Altona Rare Earths insiders decided to buy shares at close to current prices. Notably Louise Adrian was also the biggest seller.
In the last twelve months insiders purchased 3.36m shares for UK£54k. On the other hand they divested 3.31m shares, for UK£53k. In the last twelve months there was more buying than selling by Altona Rare Earths insiders. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. 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. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).
Insider Ownership Of Altona Rare Earths
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 28% of Altona Rare Earths shares, worth about UK£590k. 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 Altona Rare Earths Tell Us?
Insider buying and selling have balanced each other out in the last three months, so we can't deduct anything useful from these recent trades. However, our analysis of transactions over the last year is heartening. Insiders do have a stake in Altona Rare Earths and their transactions don't cause us concern. 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 Altona Rare Earths you should be aware of, and 4 of them don't sit too well with us.