When a single insider purchases stock, it is typically not a major deal. However, when multiple insiders purchase stock, like in SHAPE Australia Corporation Limited's (ASX:SHA) instance, it's good news for shareholders.

While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.

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SHAPE Australia Insider Transactions Over The Last Year

The Chairman of the Board Greg Miles made the biggest insider purchase in the last 12 months. That single transaction was for AU$81k worth of shares at a price of AU$2.70 each. That means that an insider was happy to buy shares at around the current price of AU$2.98. Of course they may have changed their mind. But this suggests they are optimistic. While we always like to see insider buying, it's less meaningful if the purchases were made at much lower prices, as the opportunity they saw may have passed. Happily, the SHAPE Australia insiders decided to buy shares at close to current prices.

While SHAPE Australia insiders bought shares during the last year, they didn't sell. 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!

See our latest analysis for SHAPE Australia

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

SHAPE Australia Insiders Bought Stock Recently

Over the last three months, we've seen a bit of insider buying at SHAPE Australia. Non-Executive Director Rhonda Lloyd purchased AU$59k worth of shares in that period. It's great to see that insiders are only buying, not selling. However, in this case the amount invested recently is quite small.

Does SHAPE Australia Boast High Insider Ownership?

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. It's great to see that SHAPE Australia insiders own 46% of the company, worth about AU$113m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Do The SHAPE Australia Insider Transactions Indicate?

The recent insider purchase is heartening. And the longer term insider transactions also give us confidence. Along with the high insider ownership, this analysis suggests that insiders are quite bullish about SHAPE Australia. That's what I like to see! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing SHAPE Australia. In terms of investment risks, we've identified 1 warning sign with SHAPE Australia and understanding it should be part of your investment process.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.