When a single insider purchases stock, it is typically not a major deal. However, when multiple insiders purchase stock, like in AFT Pharmaceuticals Limited's (NZSE:AFT) 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, logic dictates you should pay some attention to whether insiders are buying or selling shares.

Check out our latest analysis for AFT Pharmaceuticals

AFT Pharmaceuticals Insider Transactions Over The Last Year

The Independent Non-Executive Director Andrew Lane made the biggest insider purchase in the last 12 months. That single transaction was for NZ$257k worth of shares at a price of NZ$2.71 each. That implies that an insider found the current price of NZ$2.81 per share to be enticing. That means they have been optimistic about the company in the past, though they may have changed their mind. We do always like to see insider buying, but it is worth noting if those purchases were made at well below today's share price, as the discount to value may have narrowed with the rising price. Happily, the AFT Pharmaceuticals insiders decided to buy shares at close to current prices.

While AFT Pharmaceuticals 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 click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

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

Insiders At AFT Pharmaceuticals Have Bought Stock Recently

Over the last three months, we've seen significant insider buying at AFT Pharmaceuticals. Overall, two insiders shelled out NZ$286k for shares in the company -- and none sold. That shows some optimism about the company's future.

Insider Ownership

Many investors like to check how much of a company is owned by 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. AFT Pharmaceuticals insiders own about NZ$208m worth of shares (which is 69% of the company). 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 Does This Data Suggest About AFT Pharmaceuticals Insiders?

It is good to see recent purchasing. And the longer term insider transactions also give us confidence. When combined with notable insider ownership, these factors suggest AFT Pharmaceuticals insiders are well aligned, and quite possibly think the share price is too low. Nice! If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

Of course AFT Pharmaceuticals 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.