Simon Henry Spends AU$97k On DGL Group Stock
Even if it's not a huge purchase, we think it was good to see that Simon Henry, the Founder of DGL Group Limited (ASX:DGL) recently shelled out AU$97k to buy stock, at AU$0.29 per share. Although the purchase is not a big one, by either a percentage standpoint or absolute value, it can be seen as a good sign.
DGL Group Insider Transactions Over The Last Year
In fact, the recent purchase by Founder Simon Henry was not their only acquisition of DGL Group shares this year. Earlier in the year, they paid AU$0.39 per share in a AU$111k purchase. So it's clear an insider wanted to buy, even at a higher price than the current share price (being AU$0.29). Their view may have changed since then, but at least it shows they felt optimistic at the time. In our view, the price an insider pays for shares is very important. Generally speaking, it catches our eye when an insider has purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price. The only individual insider to buy over the last year was Simon Henry.
Simon Henry purchased 982.71k shares over the year. The average price per share was AU$0.36. 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 DGL Group
DGL Group is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.
Insider Ownership
For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. DGL Group insiders own 61% of the company, currently worth about AU$51m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
So What Do The DGL Group Insider Transactions Indicate?
The recent insider purchase is 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. When combined with notable insider ownership, these factors suggest DGL Group insiders are well aligned, and quite possibly think the share price is too low. Looks promising! 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. Case in point: We've spotted 2 warning signs for DGL Group you should be aware of, and 1 of these doesn't sit too well with us.
Of course DGL Group 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 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.