Generally, when a single insider buys stock, it is usually not a big deal. However, when several insiders are buying, like in the case of Universal Biosensors, Inc. (ASX:UBI), it sends a favourable message to the company's shareholders.
Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.
See our latest analysis for Universal Biosensors
The Last 12 Months Of Insider Transactions At Universal Biosensors
In the last twelve months, the biggest single purchase by an insider was when Non-Executive Chairman Craig Coleman bought AU$81k worth of shares at a price of AU$0.40 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being AU$0.25). It's very possible they regret the purchase, but it's more likely they are bullish about the company. We always take careful note of the price insiders pay when purchasing shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.
Universal Biosensors insiders may have bought shares in the last year, but they didn't sell any. They paid about AU$0.51 on average. I'd consider this a positive as it suggests insiders see value at around the current price. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Universal Biosensors is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Insiders At Universal Biosensors Have Bought Stock Recently
Over the last quarter, Universal Biosensors insiders have spent a meaningful amount on shares. Non-Executive Chairman Craig Coleman spent AU$81k on stock, and there wasn't any selling. That shows some optimism about the company's future.
Insider Ownership Of Universal Biosensors
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. A high insider ownership often makes company leadership more mindful of shareholder interests. Based on our data, Universal Biosensors insiders have about 1.1% of the stock, worth approximately AU$565k. We consider this fairly low insider ownership.
So What Does This Data Suggest About Universal Biosensors Insiders?
It's certainly positive to see the recent insider purchase. We also take confidence from the longer term picture of insider transactions. 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 Universal Biosensors 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 example - Universal Biosensors has 3 warning signs we think you should be aware of.
Of course Universal Biosensors may not be the best stock to buy. So you may wish to see this free collection of high quality companies.
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.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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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