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We’ve lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. On the other hand, we’d be remiss not to mention that insider sales have been known to precede tough periods for a business. So before you buy or sell Firstwave Cloud Technology Limited (ASX:FCT), you may well want to know whether insiders have been buying or selling.
Do Insider Transactions Matter?
It’s quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, such insiders must disclose their trading activities, and not trade on inside information.
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. For example, a Columbia University study found that ‘insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers’.
View our latest analysis for Firstwave Cloud Technology
Firstwave Cloud Technology Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when Non-Executive Director Simon Moore bought AU$250k worth of shares at a price of AU$0.23 per share. Although we like to see insider buying, we note that this large purchase was at significantly lower prices. The purchase might not be the best indicator of confidence in the current valuation.
In the last twelve months insiders paid AU$575k for 3.41m shares purchased. Overall, Firstwave Cloud Technology insiders were net buyers last year. The average buy price was around AU$0.17. It is certainly positive to see that insiders have invested their own money in the company. But we must note that the investments were made at well below today’s share price. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).
Insiders at Firstwave Cloud Technology Have Bought Stock Recently
Over the last three months, we’ve seen significant insider buying at Firstwave Cloud Technology. Overall, 4 insiders shelled out AU$325k for shares in the company — and none sold. That shows some optimism about the company’s future.