It is usually uneventful when a single insider buys stock. However, When quite a few insiders buy shares, as it happened in Coast Entertainment Holdings Limited’s (ASX:CEH) case, it’s fantastic news for shareholders.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
The Lead Independent Non-Executive Director David Haslingden made the biggest insider purchase in the last 12 months. That single transaction was for AU$108k worth of shares at a price of AU$0.39 each. That means that an insider was happy to buy shares at around the current price of AU$0.42. 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. We do always like to see insider buying, but it is worth noting if those purchases were made at well below today’s share price, as the discount to value may have narrowed with the rising price. In this case we’re pleased to report that the insider purchases were made at close to current prices.
In the last twelve months Coast Entertainment Holdings insiders were buying shares, but not selling. 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!
Check out our latest analysis for Coast Entertainment Holdings
Coast Entertainment Holdings 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.
Many investors like to check how much of a company is owned by 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. Coast Entertainment Holdings insiders own about AU$23m worth of shares. That equates to 14% of the company. While this is a strong but not outstanding level of insider ownership, it’s enough to indicate some alignment between management and smaller shareholders.
It doesn’t really mean much that no insider has traded Coast Entertainment Holdings shares in the last quarter. On a brighter note, the transactions over the last year are encouraging. Overall we don’t see anything to make us think Coast Entertainment Holdings insiders are doubting the company, and they do own shares. So these insider transactions can help us build a thesis about the stock, but it’s also worthwhile knowing the risks facing this company. To assist with this, we’ve discovered 1 warning sign that you should run your eye over to get a better picture of Coast Entertainment Holdings.
‘ The preceding article may include information circulated by third parties ’
‘ Some details of this article were extracted from the following source uk.finance.yahoo.com ’
