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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 SOCO Corporation Ltd (ASX:SOC), that sends out a positive message to the company's shareholders.
Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.
See our latest analysis for SOCO
The Last 12 Months Of Insider Transactions At SOCO
In the last twelve months, the biggest single sale by an insider was when the insider, Carlo Liviani, sold AU$77k worth of shares at a price of AU$0.10 per share. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. The silver lining is that this sell-down took place above the latest price (AU$0.09). So it may not tell us anything about how insiders feel about the current share price. Carlo Liviani was the only individual insider to sell shares in the last twelve months.
Over the last year, we can see that insiders have bought 715.36k shares worth AU$90k. But they sold 762.00k shares for AU$77k. Overall, SOCO insiders were net buyers during the last year. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
SOCO is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.
SOCO Insiders Are Selling The Stock
The last three months saw some SOCO insider selling. The selling netted AU$77k for insider Carlo Liviani. But AU$20k was spent on buying, too, . While it's not great to see insider selling, the net amount sold isn't enough for us to want to read anything into it.
Does SOCO 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. SOCO insiders own about AU$5.6m worth of shares (which is 44% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
What Might The Insider Transactions At SOCO Tell Us?
The insider sales have outweighed the insider buying, at SOCO, in the last three months. In contrast, they appear keener if you look at the last twelve months. On top of that, insiders own a significant portion of the company. So the recent selling doesn't worry us. 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 3 warning signs for SOCO you should be aware of, and 2 of them are a bit concerning.