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 Sprintex Limited (ASX:SIX), that sends out a positive message to the company's shareholders.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

View our latest analysis for Sprintex

The Last 12 Months Of Insider Transactions At Sprintex

The insider Richard Siemens made the biggest insider purchase in the last 12 months. That single transaction was for AU$249k worth of shares at a price of AU$0.044 each. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of AU$0.052. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.

While Sprintex insiders bought shares during the last year, they didn't sell. The average buy price was around AU$0.019. It is certainly positive to see that insiders have invested their own money in the company. However, you should keep in mind that they bought when the share price was meaningfully below today's levels. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

Sprintex is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.

Insider Ownership

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Sprintex insiders own 47% of the company, currently worth about AU$13m based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Does This Data Suggest About Sprintex Insiders?

The fact that there have been no Sprintex insider transactions recently certainly doesn't bother us. On a brighter note, the transactions over the last year are encouraging. Judging from their transactions, and high insider ownership, Sprintex insiders feel good about the company's future. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. To that end, you should learn about the 7 warning signs we've spotted with Sprintex (including 4 which make us uncomfortable).