Insider Spends UK£40k Buying More Shares In Insig AI

Simply Wall St · 10/16 05:07

Whilst it may not be a huge deal, we thought it was good to see that the Insig AI Plc (LON:INSG) CEO & Executive Director, Richard Bernstein, recently bought UK£40k worth of stock, for UK£0.11 per share. However, it only increased their shares held by 1.6%, and it wasn't a huge purchase by absolute value, either.

See our latest analysis for Insig AI

The Last 12 Months Of Insider Transactions At Insig AI

In fact, the recent purchase by CEO & Executive Director Richard Bernstein was not their only acquisition of Insig AI shares this year. They previously made an even bigger purchase of UK£100k worth of shares at a price of UK£0.20 per share. That means that even when the share price was higher than UK£0.12 (the recent price), an insider wanted to purchase shares. 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. As a general rule, we feel more positive about a stock when an insider has bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price. Richard Bernstein was the only individual insider to buy shares in the last twelve months.

Richard Bernstein bought 1.38m shares over the last 12 months at an average price of UK£0.16. 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!

insider-trading-volume
AIM:INSG Insider Trading Volume October 16th 2024

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.

Does Insig AI Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. It's great to see that Insig AI insiders own 48% of the company, worth about UK£6.5m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Do The Insig AI Insider Transactions Indicate?

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. When combined with notable insider ownership, these factors suggest Insig AI insiders are well aligned, and quite possibly think the share price is too low. One for the watchlist, at least! While it's good to be aware of 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. To that end, you should learn about the 4 warning signs we've spotted with Insig AI (including 2 which are a bit unpleasant).

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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 of direct interests only, but not derivative transactions or indirect interests.