Investors who take an interest in Drax Group plc (LON:DRX) should definitely note that the CFO & Director, Andy Skelton, recently paid UK£2.72 per share to buy UK£166k worth of the stock. We reckon that's a good sign, especially since the purchase boosted their holding by 74%.
Check out our latest analysis for Drax Group
The Last 12 Months Of Insider Transactions At Drax Group
Notably, that recent purchase by Andy Skelton is the biggest insider purchase of Drax Group shares that we've seen in the last year. So it's clear an insider wanted to buy, at around the current price, which is UK£2.80. 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. While we always like to see insider buying, it's less meaningful if the purchases were made at much lower prices, as the opportunity they saw may have passed. The good news for Drax Group share holders is that insiders were buying at near the current price.
While Drax Group insiders bought shares during the last year, they didn't sell. Their average price was about UK£2.00. We don't deny that it is nice to see insiders buying stock in the company. However, you should keep in mind that they bought when the share price was meaningfully below today's levels. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
Insider Ownership of Drax Group
Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. Based on our data, Drax Group insiders have about 0.2% of the stock, worth approximately UK£1.9m. I generally like to see higher levels of ownership.
So What Does This Data Suggest About Drax Group Insiders?
The recent insider purchases are heartening. And an analysis of the transactions over the last year also gives us confidence. But we don't feel the same about the fact the company is making losses. We would certainly prefer see higher levels of insider ownership but analysis of the insider transactions suggests that Drax Group insiders are expecting a bright future. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. For instance, we've identified 3 warning signs for Drax Group (1 is a bit unpleasant) you should be aware of.
But note: Drax Group may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.
For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions, but not derivative transactions.
This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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