Potential Quantum Graphite Limited (ASX:QGL) shareholders may wish to note that the MD & Executive Director, Salvatore Catalano, recently bought AU$167k worth of stock, paying AU$0.49 for each share. Although the purchase only increased their holding by 1.3%, it is still a solid purchase in our view.

See our latest analysis for Quantum Graphite

The Last 12 Months Of Insider Transactions At Quantum Graphite

Notably, that recent purchase by Salvatore Catalano is the biggest insider purchase of Quantum Graphite shares that we've seen in the last year. So it's clear an insider wanted to buy, at around the current price, which is AU$0.50. 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. The good news for Quantum Graphite share holders is that insiders were buying at near the current price.

Over the last year, we can see that insiders have bought 1.08m shares worth AU$528k. But they sold 159.16k shares for AU$78k. In the last twelve months there was more buying than selling by Quantum Graphite insiders. 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 plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.

Insider Ownership Of Quantum Graphite

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. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 29% of Quantum Graphite shares, worth about AU$49m. 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 Quantum Graphite Tell Us?

The recent insider purchases are heartening. 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. Given that insiders also own a fair bit of Quantum Graphite we think they are probably pretty confident of a bright future. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. At Simply Wall St, we found 2 warning signs for Quantum Graphite that deserve your attention before buying any shares.

But note: Quantum Graphite 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.