How Much Are Sienna Cancer Diagnostics Limited (ASX:SDX) Insiders Spending On Buying Shares?
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 shareholders might well want to know whether insiders have been buying or selling shares in Sienna Cancer Diagnostics Limited (ASX:SDX).
Do Insider Transactions Matter?
It’s quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, rules govern insider transactions, and certain disclosures are required.
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’.
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The Last 12 Months Of Insider Transactions At Sienna Cancer Diagnostics
David Williams made the biggest insider purchase in the last 12 months. That single transaction was for AU$531k worth of shares at a price of AU$0.06 each. That means that an insider was happy to buy shares at around the current price. That means they have been optimistic about the company in the past, though they may have changed their mind. We generally consider it a positive if insiders have been buying on market, even if the share price has increased a bit since then. David Williams was the only individual insider to buy shares in the last twelve months.
David Williams purchased 19.15m shares over the year. The average price per share was AU$0.07. You can see the insider transactions (by individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!
I will like Sienna Cancer Diagnostics better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
Insider Ownership
For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it’s a good sign if insiders own a significant number of shares in the company. Insiders own 25% of Sienna Cancer Diagnostics shares, worth about AU$4.0m. 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 Sienna Cancer Diagnostics Insiders?
There haven’t been any insider transactions in the last three months — that doesn’t mean much. But insiders have shown more of an appetite for the stock, over the last year. Insiders own shares in Sienna Cancer Diagnostics and we see no evidence to suggest they are worried about the future. Along with insider transactions, I recommend checking if Sienna Cancer Diagnostics is growing revenue. This free chart of historic revenue and earnings should make that easy.
Of course Sienna Cancer Diagnostics may not be the best stock to buy. So you may wish to see this free collection of high quality companies.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
