Yahoo Finance One Vital Limited (NZSE:VTL) insider upped their stake by 480% in the previous year
From what we can see, insiders were net buyers in Vital Limited's (NZSE:VTL ) during the past 12 months. That is, insiders acquired the stock in greater numbers than they sold it.
While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
See our latest analysis for Vital
Vital Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when Chief Executive Officer Andrew Miller bought NZ$639k worth of shares at a price of NZ$0.80 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being NZ$0.46). Their view may have changed since then, but at least it shows they felt optimistic at the time. To us, it's very important to consider the price insiders pay for shares. As a general rule, we feel more positive about a stock when an insider has bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price. Andrew Miller was the only individual insider to buy shares in the last twelve months.
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!
Vital is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Insider Ownership
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Vital insiders own about NZ$5.6m worth of shares. That equates to 30% of the company. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
So What Do The Vital Insider Transactions Indicate?
It doesn't really mean much that no insider has traded Vital shares in the last quarter. But insiders have shown more of an appetite for the stock, over the last year. Insiders do have a stake in Vital and their transactions don't cause us concern. 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. For example, Vital has 4 warning signs (and 1 which makes us a bit uncomfortable) we think 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, but not derivative transactions.
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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.
