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Investors who take an interest in AMA Group Limited (ASX:AMA) should definitely note that the Independent Non-Executive Chairman, Brian Austin, recently paid AU$0.99 per share to buy AU$197k worth of the stock. Although the purchase only increased their holding by 2.6%, it is still a solid purchase in our view.

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In fact, the recent purchase by Independent Non-Executive Chairman Brian Austin was not their only acquisition of AMA Group shares this year. Earlier in the year, they paid AU$1.00 per share in a AU$499k purchase. That means that an insider was happy to buy shares at above the current price of AU$0.93. Their view may have changed since then, but at least it shows they felt optimistic at the time. In our view, the price an insider pays for shares is very important. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.

In the last twelve months AMA Group insiders were buying shares, but not selling. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

View our latest analysis for AMA Group

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.

Many investors like to check how much of a company is owned by 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. It appears that AMA Group insiders own 8.9% of the company, worth about AU$40m. While this is a strong but not outstanding level of insider ownership, it’s enough to indicate some alignment between management and smaller shareholders.

It is good to see the recent insider purchase. And the longer term insider transactions also give us confidence. However, we note that the company didn’t make a profit over the last twelve months, which makes us cautious. Insiders likely see value in AMA Group shares, given these transactions (along with notable insider ownership of the company). Therefore, you should definitely take a look at this FREE report showing analyst forecasts for AMA Group.

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.