Great news for GrainCorp Limited (ASX:GNC): Insiders acquired stock in large numbers last year
Usually, when one insider buys stock, it might not be a monumental event. But when multiple insiders are buying like they did in the case of GrainCorp Limited (ASX:GNC), that sends out a positive message to the company's shareholders.
While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.
Check out our latest analysis for GrainCorp
GrainCorp Insider Transactions Over The Last Year
The Independent Non-Executive Director Clive M. Stiff made the biggest insider purchase in the last 12 months. That single transaction was for AU$84k worth of shares at a price of AU$8.43 each. That means that even when the share price was higher than AU$7.81 (the recent price), an insider wanted to purchase shares. 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. 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 if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.
GrainCorp insiders may have bought shares in the last year, but they didn't sell any. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
GrainCorp is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
GrainCorp Insiders Bought Stock Recently
Over the last quarter, GrainCorp insiders have spent a meaningful amount on shares. In total, insiders bought AU$159k worth of shares in that time, and we didn't record any sales whatsoever. This makes one think the business has some good points.
Insider Ownership Of GrainCorp
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. Insiders own 0.9% of GrainCorp shares, worth about AU$15m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
So What Does This Data Suggest About GrainCorp Insiders?
It's certainly positive to see the recent insider purchases. And the longer term insider transactions also give us confidence. Given that insiders also own a fair bit of GrainCorp we think they are probably pretty confident of a bright future. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. When we did our research, we found 2 warning signs for GrainCorp (1 is a bit concerning!) that we believe deserve your full attention.
Of course GrainCorp 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, 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.
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