We often see insiders buying up shares in companies that perform well over the long term. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So we'll take a look at whether insiders have been buying or selling shares in Genworth Mortgage Insurance Australia Limited (ASX:GMA).
What Is Insider Selling?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, most countries require that the company discloses such transactions to the market.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Columbia University study found that 'insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers'.
The Last 12 Months Of Insider Transactions At Genworth Mortgage Insurance Australia
There wasn't any very large single transaction over the last year, but we can still observe some trading.
Over the last year, we can see that insiders have bought 67372 shares worth AU$157k. In the last twelve months Genworth Mortgage Insurance Australia insiders were buying shares, but not selling. The average buy price was around AU$2.32. It's great to see insiders putting their own cash into the company's stock, albeit at below the recent share price (AU$2.44). You can see the insider transactions (by 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!
There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).
Genworth Mortgage Insurance Australia Insiders Bought Stock Recently
We saw some Genworth Mortgage Insurance Australia insider buying shares in the last three months. Insiders bought AU$62k worth of shares in that time. We like it when there are only buyers, and no sellers. However, in this case the amount invested recently is quite small.
Does Genworth Mortgage Insurance Australia Boast High Insider Ownership?
For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. Our data suggests Genworth Mortgage Insurance Australia insiders own 0.6% of the company, worth about AU$6.7m. We prefer to see high levels of insider ownership.
So What Do The Genworth Mortgage Insurance Australia Insider Transactions Indicate?
The recent insider purchases are heartening. And the longer term insider transactions also give us confidence. We would certainly prefer see higher levels of insider ownership but analysis of the insider transactions suggests that Genworth Mortgage Insurance Australia insiders are expecting a bright future. Of course, the future is what matters most. So if you are interested in Genworth Mortgage Insurance Australia, you should check out this free report on analyst forecasts for the company.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.