Those following along with Frontier Energy Limited (ASX:FHE) will no doubt be intrigued by the recent purchase of shares by Grant Burnaford Davey, Non-Executive Director of the company, who spent a stonking AU$2.0m on stock at an average price of AU$0.20. Aside from being a solid chunk in its own right, the deft move also saw their holding increase by some 14%.
The Last 12 Months Of Insider Transactions At Frontier Energy
Notably, that recent purchase by Grant Burnaford Davey is the biggest insider purchase of Frontier Energy shares that we've seen in the last year. So it's clear an insider wanted to buy, even at a higher price than the current share price (being AU$0.19). It's very possible they regret the purchase, but it's more likely they are bullish about the company. We always take careful note of the price insiders pay when purchasing 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.
In the last twelve months Frontier Energy insiders were buying shares, but not selling. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
See our latest analysis for Frontier Energy
Frontier Energy is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.
Does Frontier Energy Boast High Insider Ownership?
For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that Frontier Energy insiders own 38% of the company, worth about AU$41m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
What Might The Insider Transactions At Frontier Energy Tell Us?
The recent insider purchases are heartening. And an analysis of the transactions over the last year also gives us confidence. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. Insiders likely see value in Frontier Energy shares, given these transactions (along with notable insider ownership of the company). In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Frontier Energy. To that end, you should learn about the 2 warning signs we've spotted with Frontier Energy (including 1 which makes us a bit uncomfortable).
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 of direct interests only, but not derivative transactions or indirect interests.
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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.