Insiders seem to have made the most of their holdings by selling AU$944k worth of AVADA Group Limited (ASX:AVD) stock at an average sell price of AU$0.066 during the past year. The company's market valuation decreased by AU$2.1m after the stock price dropped 18% over the past week, but insiders were spared from painful losses.
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.
In the last twelve months, the biggest single sale by an insider was when the MD & Director, Daniel Crowley, sold AU$944k worth of shares at a price of AU$0.20 per share. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The good news is that this large sale was at well above current price of AU$0.12. So it may not shed much light on insider confidence at current levels. Daniel Crowley was the only individual insider to sell shares in the last twelve months. Notably Daniel Crowley was also the biggest buyer, having purchased AU$339k worth of shares.
Happily, we note that in the last year insiders paid AU$339k for 3.26m shares. But insiders sold 14.36m shares worth AU$944k. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
See our latest analysis for AVADA Group
If you are like me, then you will not want to miss this free list of small cap stocks that are not only being bought by insiders but also have attractive valuations.
Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. AVADA Group insiders own about AU$3.8m worth of shares. That equates to 39% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
There haven't been any insider transactions in the last three months -- that doesn't mean much. We don't take much encouragement from the transactions by AVADA Group insiders. But it's good to see that insiders own shares in the company. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Every company has risks, and we've spotted 3 warning signs for AVADA Group you should know about.
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.
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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.