Those following along with IperionX Limited (ASX:IPX) will no doubt be intrigued by the recent purchase of shares by Todd Hannigan, Executive Chairman of the company, who spent a stonking AU$1.9m on stock at an average price of AU$3.20. While that only increased their holding size by 2.5%, it is still a big swing by our standards.

Check out our latest analysis for IperionX

IperionX Insider Transactions Over The Last Year

Notably, that recent purchase by Executive Chairman Todd Hannigan was not the only time they bought IperionX shares this year. They previously made an even bigger purchase of AU$6.1m worth of shares at a price of AU$1.91 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of AU$5.08. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

In the last twelve months IperionX insiders were buying shares, but not selling. 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!

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

Insider Ownership Of IperionX

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. IperionX insiders own 19% of the company, currently worth about AU$289m based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Do The IperionX Insider Transactions Indicate?

It's certainly positive to see the recent insider purchase. And the longer term insider transactions also give us confidence. But we don't feel the same about the fact the company is making losses. Along with the high insider ownership, this analysis suggests that insiders are quite bullish about IperionX. Nice! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For instance, we've identified 2 warning signs for IperionX (1 makes us a bit uncomfortable) you should be aware of.

But note: IperionX 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.