Whilst it may not be a huge deal, we thought it was good to see that the Great Western Exploration Limited (ASX:GTE) Non-Executive Director, Grey Egerton-Warburton, recently bought AU$150k worth of stock, for AU$0.032 per share. While we're hesitant to get too excited about a purchase of that size, we do note it increased their holding by a solid 10%.

See our latest analysis for Great Western Exploration

The Last 12 Months Of Insider Transactions At Great Western Exploration

Notably, that recent purchase by Non-Executive Director Grey Egerton-Warburton was not the only time they bought Great Western Exploration shares this year. Earlier in the year, they paid AU$0.032 per share in a AU$300k purchase. That means that even when the share price was higher than AU$0.026 (the recent price), an insider wanted to purchase shares. It's very possible they regret the purchase, but it's more likely they are bullish about the company. In our view, the price an insider pays for shares is very important. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.

In the last twelve months Great Western Exploration insiders were buying shares, but not selling. 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!

There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company 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. Great Western Exploration insiders own about AU$2.5m worth of shares. That equates to 20% of the company. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

What Might The Insider Transactions At Great Western Exploration Tell Us?

It is good to see recent purchasing. 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. When combined with notable insider ownership, these factors suggest Great Western Exploration insiders are well aligned, and that they may think the share price is too low. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Great Western Exploration. To help with this, we've discovered 5 warning signs (4 are potentially serious!) that you ought to be aware of before buying any shares in Great Western Exploration.

But note: Great Western Exploration 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.