Potential Predictive Discovery Limited (ASX:PDI) shareholders may wish to note that the Independent Non-Executive Director, Alberto Lavandeira Adan, recently bought AU$218k worth of stock, paying AU$0.35 for each share. That certainly has us anticipating the best, especially since they thusly increased their own holding by 846%, potentially signalling some real optimism.

View our latest analysis for Predictive Discovery

Predictive Discovery Insider Transactions Over The Last Year

Notably, that recent purchase by Alberto Lavandeira Adan is the biggest insider purchase of Predictive Discovery shares that we've seen in the last year. That means that an insider was happy to buy shares at around the current price of AU$0.37. 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. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. The good news for Predictive Discovery share holders is that insiders were buying at near the current price.

Predictive Discovery insiders may have bought shares in the last year, but they didn't sell any. The average buy price was around AU$0.31. It is certainly positive to see that insiders have invested their own money in the company. But we must note that the investments were made at well below today's share 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!

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Insider Ownership Of Predictive Discovery

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that Predictive Discovery insiders own 4.6% of the company, worth about AU$45m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Does This Data Suggest About Predictive Discovery Insiders?

It's certainly positive to see the recent insider purchase. We also take confidence from the longer term picture of insider transactions. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. Given that insiders also own a fair bit of Predictive Discovery we think they are probably pretty confident of a bright future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Predictive Discovery. To help with this, we've discovered 2 warning signs (1 shouldn't be ignored!) that you ought to be aware of before buying any shares in Predictive Discovery.

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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.