When a single insider purchases stock, it is typically not a major deal. However, when multiple insiders purchase stock, like in Coventry Group Ltd’s (ASX:CYG) instance, it’s good news for shareholders.

While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.

We’ve discovered 4 warning signs about Coventry Group. View them for free.

Over the last year, we can see that the biggest insider purchase was by Independent Non-Executive Chairman Neil Cathie for AU$145k worth of shares, at about AU$1.45 per share. That means that an insider was happy to buy shares at above the current price of AU$0.93. It’s very possible they regret the purchase, but it’s more likely they are bullish about the company. In our view, the price an insider pays for shares is very important. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.

Over the last year, we can see that insiders have bought 301.56k shares worth AU$405k. On the other hand they divested 159.45k shares, for AU$166k. In total, Coventry Group insiders bought more than they sold over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

View our latest analysis for Coventry Group

There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).

Over the last three months, we’ve seen notably more insider selling, than insider buying, at Coventry Group. In that time, CEO, MD & Director Robert Bulluss dumped AU$166k worth of shares. On the flip side, Non-Executive Director Anthony Howarth spent AU$9.6k on purchasing shares. We don’t view these transactions as a positive sign.

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. From looking at our data, insiders own AU$4.2m worth of Coventry Group stock, about 3.8% of the company. However, it’s possible that insiders might have an indirect interest through a more complex structure. We prefer to see high levels of insider ownership.