When a single insider purchases stock, it is typically not a major deal. However, when multiple insiders purchase stock, like in Cosmos Health Inc.'s (NASDAQ:COSM) instance, it's good news for shareholders.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

Check out our latest analysis for Cosmos Health

The Last 12 Months Of Insider Transactions At Cosmos Health

Over the last year, we can see that the biggest insider purchase was by Chairman & CEO Grigorios Siokas for US$150k worth of shares, at about US$0.58 per share. So it's clear an insider wanted to buy, at around the current price, which is US$0.64. 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. 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. In this case we're pleased to report that the insider purchases were made at close to current prices.

Happily, we note that in the last year insiders paid US$539k for 823.90k shares. But insiders sold 5.00k shares worth US$5.0. In the last twelve months there was more buying than selling by Cosmos Health insiders. They paid about US$0.65 on average. This is nice to see since it implies that insiders might see value around current prices. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. 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).

Insiders At Cosmos Health Have Bought Stock Recently

Over the last quarter, Cosmos Health insiders have spent a meaningful amount on shares. Overall, two insiders shelled out US$539k for shares in the company -- and none sold. This is a positive in our book as it implies some confidence.

Insider Ownership Of Cosmos Health

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Insiders own 25% of Cosmos Health shares, worth about US$3.2m. 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 Cosmos Health Tell Us?

It is good to see recent purchasing. We also take confidence from the longer term picture of insider transactions. But we don't feel the same about the fact the company is making losses. Insiders likely see value in Cosmos Health shares, given these transactions (along with notable insider ownership of the company). In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Cosmos Health. At Simply Wall St, we found 4 warning signs for Cosmos Health that deserve your attention before buying any shares.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.