Peako Insiders May Regret Not Buying More, Market Cap Hits AU$4.4m
Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.
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Over the last year, we can see that the biggest insider purchase was by insider Andrew Wilson for AU$205k worth of shares, at about AU$0.003 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of AU$0.004. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.
Happily, we note that in the last year insiders paid AU$331k for 93.51m shares. On the other hand they divested 25.18m shares, for AU$126k. In total, Peako insiders bought more than they sold over the last year. They paid about AU$0.0035 on average. It is certainly positive to see that insiders have invested their own money in the company. But we must note that the investments were made at well below today's share price. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
See our latest analysis for Peako
Peako is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.
There has been significantly more insider buying, than selling, at Peako, over the last three months. In total, three insiders bought AU$331k worth of shares in that time. But insider Ernest Albers sold shares worth AU$126k. The buying outweighs the selling, which suggests that insiders may believe the company will do well in the future.
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Insiders own 26% of Peako shares, worth about AU$1.1m. 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's certainly positive to see the recent insider purchases. And the longer term insider transactions also give us confidence. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. When combined with notable insider ownership, these factors suggest Peako insiders are well aligned, and that they may think the share price is too low. 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. At Simply Wall St, we found 5 warning signs for Peako that deserve your attention before buying any shares.
But note: Peako may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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.
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.
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