The recent 25% drop in Vintage Energy Limited's (ASX:VEN) stock could come as a blow to insiders who purchased AU$403.0k worth of stock at an average buy price of AU$0.004 over the past 12 months. Insiders invest with the hopes of seeing their money grow in value over time. However, as a result of recent losses, their initial investment is now only worth AU$151.1k, which is not what they expected.
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.
The Last 12 Months Of Insider Transactions At Vintage Energy
Over the last year, we can see that the biggest insider purchase was by Independent Chairman of the Board Reginald Nelson for AU$262k worth of shares, at about AU$0.004 per share. That means that an insider was happy to buy shares at above the current price of AU$0.0015. 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.
While Vintage Energy insiders bought shares during the last year, they didn't sell. 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!
View our latest analysis for Vintage Energy
Vintage 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.
Vintage Energy Insiders Bought Stock Recently
It's good to see that Vintage Energy insiders have made notable investments in the company's shares. Not only was there no selling that we can see, but they collectively bought AU$325k worth of shares. That shows some optimism about the company's future.
Insider Ownership Of Vintage Energy
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. From our data, it seems that Vintage Energy insiders own 14% of the company, worth about AU$505k. However, it's possible that insiders might have an indirect interest through a more complex structure. We do generally prefer see higher levels of insider ownership.
What Might The Insider Transactions At Vintage Energy Tell Us?
It's certainly positive to see the recent insider purchases. 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. On this analysis the only slight negative we see is the fairly low (overall) insider ownership; their transactions suggest that they are quite positive on Vintage Energy stock. 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. Be aware that Vintage Energy is showing 6 warning signs in our investment analysis, and 4 of those make us uncomfortable...
But note: Vintage Energy 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.
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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.