Whilst it may not be a huge deal, we thought it was good to see that the Servcorp Limited (ASX:SRV) Founder, Alfred Moufarrige, recently bought AU$120k worth of stock, for AU$5.30 per share. Nevertheless, it only increased their shareholding by a minuscule percentage, and it wasn't a massive purchase by absolute value, either.

Servcorp Insider Transactions Over The Last Year

In fact, the recent purchase by Founder Alfred Moufarrige was not their only acquisition of Servcorp shares this year. They previously made an even bigger purchase of AU$490k worth of shares at a price of AU$4.90 per share. That implies that an insider found the current price of AU$5.35 per share to be enticing. Of course they may have changed their mind. But this suggests they are optimistic. 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. The good news for Servcorp share holders is that an insider was buying at near the current price. Alfred Moufarrige was the only individual insider to buy shares in the last twelve months.

Alfred Moufarrige purchased 322.30k shares over the year. The average price per share was AU$4.79. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

View our latest analysis for Servcorp

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.

Does Servcorp Boast High Insider Ownership?

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 3.3% of Servcorp shares, worth about AU$18m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Does This Data Suggest About Servcorp Insiders?

It is good to see the recent insider purchase. We also take confidence from the longer term picture of insider transactions. Given that insiders also own a fair bit of Servcorp 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. In terms of investment risks, we've identified 1 warning sign with Servcorp and understanding this should be part of your investment process.

Of course Servcorp 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.