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We often see insiders buying up shares in companies that perform well over the long term. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So we’ll take a look at whether insiders have been buying or selling shares in Dicker Data Limited (ASX:DDR).
What Is Insider Buying?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, rules govern insider transactions, and certain disclosures are required.
We don’t think shareholders should simply follow insider transactions. But logic dictates you should pay some attention to whether insiders are buying or selling shares. As Peter Lynch said, ‘insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.’
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Dicker Data Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when COO & Executive Director Vladimir Mitnovetski bought AU$563k worth of shares at a price of AU$2.83 per share. That means that an insider was happy to buy shares at around the current price. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company’s future. In any event it’s generally a positive if insiders are buying shares at around the current price.
Happily, we note that in the last year insiders bought 413.95k shares for a total of AU$1.2m. In the last twelve months there was more buying than selling by Dicker Data insiders. The average buy price was around AU$2.85. This is nice to see since it implies that insiders might see value around current prices (around AU$2.83). You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).
Dicker Data Insiders Bought Stock Recently
It’s good to see that Dicker Data insiders have made notable investments in the company’s shares. Overall, 2 insiders shelled out AU$310k for shares in the company — and none sold. This makes one think the business has some good points.