When a single insider purchases stock, it is typically not a major deal. However, when multiple insiders purchase stock, like in Alpha Teknova, Inc.'s (NASDAQ:TKNO) 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.

See our latest analysis for Alpha Teknova

The Last 12 Months Of Insider Transactions At Alpha Teknova

Over the last year, we can see that the biggest insider purchase was by President Stephen Gunstream for US$100k worth of shares, at about US$1.24 per share. We do like to see buying, but this purchase was made at well below the current price of US$9.17. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.

Alpha Teknova insiders may have bought shares in the last year, but they didn't sell any. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

Alpha Teknova is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.

Insider Ownership

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. Alpha Teknova insiders own about US$67m worth of shares. That equates to 13% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Do The Alpha Teknova Insider Transactions Indicate?

It doesn't really mean much that no insider has traded Alpha Teknova shares in the last quarter. However, our analysis of transactions over the last year is heartening. Overall we don't see anything to make us think Alpha Teknova insiders are doubting the company, and they do own shares. 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. Our analysis shows 3 warning signs for Alpha Teknova (1 doesn't sit too well with us!) and we strongly recommend you look at them before investing.

Of course Alpha Teknova may not be the best stock to buy. So you may wish to see this free collection of high quality companies.

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.