Once a week I like to look at which ASX shares have been experiencing insider buying. This is because insider buying is often regarded as a bullish indicator as few should know a company, its prospects, and true value better than its own directors.
Three shares which have been experiencing meaningful insider buying recently are listed below:
Hydroponics Company Ltd (ASX: THC)
Two change of director’s interest notices reveal that this medicinal cannabis company has experienced a bout of insider buying this week. Board members Lou Cattelan and Gary Radcliff have picked up their second parcel of shares in the company since being voted in earlier this year. Mr Cattelan picked up 88,495 shares for a total consideration of $51,323.61 through on-market trades. This works out to be approximately 58 cents per share. Mr Radcliff bought 38,616 shares though on-market trades for a total consideration of $23,369.60 or 60.5 cents per share. Hydroponics Company’s shares are currently trading at 59 cents.
Liquefied Natural Gas Ltd (ASX: LNG)
According to a change of director’s interest notice released this morning, this liquefied natural gas company’s chairman, Paul Cavicchi, has been buying its US-listed over the counter ADRs. Mr Cavicchi bought 100,000 ADRs, which equates to 400,000 ordinary shares, this week for a total consideration of US$168,750. Despite its shares and ADRs rising by around 50% over the last 10 weeks, Mr Cavicchi clearly still sees a lot of value in them. As does CEO Gregory Vesey who picked up 150,000 ordinary shares at 56 cents per share yesterday. The company’s share price has rallied higher on the news.
Sigma Healthcare Ltd (ASX: SIG)
A change of director’s interest notice reveals that the chairman of this embattled pharmacy chain operator and distributor has been buying shares on-market. Brian Jamieson has taken advantage of Sigma’s significant share price decline to top up his holding by 50,000 shares for a total consideration of $24,000. This lifts Mr Jamieson’s holding to 830,078 shares. While I wouldn’t be a buyer of its shares just yet, not everyone is as bearish as I am. A note out of Citi this week declared Sigma as a (high risk) buy with a price target of 55 cents. Its shares are currently priced at 46.7 cents.
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.