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When a single insider purchases stock, it is typically not a major deal. However, when multiple insiders purchase stock, like in DiaMedica Therapeutics Inc.'s (NASDAQ:DMAC) instance, it's good news for shareholders.
Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.
DiaMedica Therapeutics Insider Transactions Over The Last Year
The insider Amy Burroughs made the biggest insider purchase in the last 12 months. That single transaction was for US$142k worth of shares at a price of US$3.15 each. We do like to see buying, but this purchase was made at well below the current price of US$4.03. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.
DiaMedica Therapeutics insiders may have bought shares in the last year, but they didn't sell any. Their average price was about US$3.52. To my mind it is good that insiders have invested their own money in the company. But we must note that the investments were made at well below today's share price. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
DiaMedica Therapeutics is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
DiaMedica Therapeutics Insiders Bought Stock Recently
Over the last three months, we've seen significant insider buying at DiaMedica Therapeutics. Overall, five insiders shelled out US$359k for shares in the company -- and none sold. This makes one think the business has some good points.
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with 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. Our data suggests DiaMedica Therapeutics insiders own 2.2% of the company, worth about US$2.4m. I generally like to see higher levels of ownership.
What Might The Insider Transactions At DiaMedica Therapeutics 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. But we don't feel the same about the fact the company is making losses. While the overall levels of insider ownership are below what we'd like to see, the history of transactions imply that DiaMedica Therapeutics insiders are reasonably well aligned, and optimistic for the future. While we like knowing 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. Case in point: We've spotted 3 warning signs for DiaMedica Therapeutics you should be aware of, and 1 of these is a bit unpleasant.
But note: DiaMedica Therapeutics 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, but not derivative transactions.
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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