Looking at Lucapa Diamond Company Limited’s (ASX:LOM ) insider transactions over the last year, we can see that insiders were net buyers. That is, there were more number of shares purchased by insiders than there were sold.
While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
See our latest analysis for Lucapa Diamond
Lucapa Diamond Insider Transactions Over The Last Year
The Non-Executive Director Ross Stanley made the biggest insider purchase in the last 12 months. That single transaction was for AU$1m worth of shares at a price of AU$0.075 each. That means that an insider was happy to buy shares above the current price of AU$0.046. 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 our view, the price an insider pays for shares is very important. It is encouraging to see an insider paid above the current price for shares, as it suggests they see value, even at higher levels. The only individual insider to buy over the last year was Ross Stanley.
You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
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 Lucapa Diamond
For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. Insiders own 8.9% of Lucapa Diamond shares, worth about AU$5.8m, according to our data. However, it’s possible that insiders might have an indirect interest through a more complex structure. Overall, this level of ownership isn’t that impressive, but it’s certainly better than nothing!
So What Do The Lucapa Diamond Insider Transactions Indicate?
The fact that there have been no Lucapa Diamond insider transactions recently certainly doesn’t bother us. However, our analysis of transactions over the last year is heartening. We’d like to see bigger individual holdings. However, we don’t see anything to make us think Lucapa Diamond insiders are doubting the company. So these insider transactions can help us build a thesis about the stock, but it’s also worthwhile knowing the risks facing this company. Be aware that Lucapa Diamond is showing 3 warning signs in our investment analysisand 1 of those is significant…
Of course Lucapa Diamond 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.
Have feedback on this article? Concerned about the content? get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
Join A Paid User Research Session
You’ll receive a US$30 Amazon Gift Card for 1 hour of your time while helping us build better investing tools for the individual investors like yourself. Sign up here