It is usually uneventful when a single insider buys stock. However, When quite a few insiders buy shares, as it happened in The Lottery Corporation Limited's (ASX:TLC) case, it's fantastic news for shareholders.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

See our latest analysis for Lottery

The Last 12 Months Of Insider Transactions At Lottery

The MD, CEO & Director Sue van der Merwe made the biggest insider purchase in the last 12 months. That single transaction was for AU$750k worth of shares at a price of AU$5.15 each. That means that an insider was happy to buy shares at above the current price of AU$5.12. Their view may have changed since then, but at least it shows they felt optimistic at the time. We always take careful note of the price insiders pay when purchasing shares. 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.

Lottery insiders may have bought shares in the last year, but they didn't sell any. 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!

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 Lottery Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Based on our data, Lottery insiders have about 0.06% of the stock, worth approximately AU$7.2m. We prefer to see high levels of insider ownership.

So What Does This Data Suggest About Lottery Insiders?

It doesn't really mean much that no insider has traded Lottery shares in the last quarter. However, our analysis of transactions over the last year is heartening. The transactions are fine but it'd be more encouraging if Lottery insiders bought more shares in the company. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. To assist with this, we've discovered 2 warning signs that you should run your eye over to get a better picture of Lottery.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]