Insiders who bought US$241.4k worth of Noodles & Company (NASDAQ:NDLS) stock in the last year have seen some of their losses recouped as the stock gained 61% last week. However, the purchase is proving to be a costly gamble, since losses made by insiders have totalled US$63k since the time of purchase.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

See our latest analysis for Noodles

The Last 12 Months Of Insider Transactions At Noodles

Over the last year, we can see that the biggest insider purchase was by insider James Hoak for US$123k worth of shares, at about US$2.19 per share. That means that an insider was happy to buy shares at above the current price of US$1.39. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. We always take careful note of the price insiders pay when purchasing shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.

In the last twelve months Noodles insiders were buying shares, but not selling. The average buy price was around US$1.88. I'd consider this a positive as it suggests insiders see value at around the current price. 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!

Noodles 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 Of Noodles

Many investors like to check how much of a company is owned by 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. From our data, it seems that Noodles insiders own 5.7% of the company, worth about US$3.6m. We do generally prefer see higher levels of insider ownership.

So What Do The Noodles Insider Transactions Indicate?

It doesn't really mean much that no insider has traded Noodles shares in the last quarter. However, our analysis of transactions over the last year is heartening. The transactions are fine but it'd be more encouraging if Noodles insiders bought more shares in the company. 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. Be aware that Noodles is showing 4 warning signs in our investment analysis, and 1 of those is concerning...

But note: Noodles 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.