Insiders who bought US$11.2m worth of Ready Capital Corporation (NYSE:RC) stock in the last year recovered part of their losses as the stock rose by 11% last week. The purchase, however, has proven to be a pricey bet, with losses currently totalling US$2.1m.

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.

The Last 12 Months Of Insider Transactions At Ready Capital

The insider Howard Amster made the biggest insider purchase in the last 12 months. That single transaction was for US$11m worth of shares at a price of US$4.25 each. That means that even when the share price was higher than US$1.78 (the recent price), an insider wanted to purchase shares. 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. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.

In the last twelve months insiders purchased 5.07m shares for US$11m. But they sold 2.80k shares for US$5.1k. Overall, Ready Capital insiders were net buyers during the last year. Their average price was about US$2.20. I'd consider this a positive as it suggests insiders see value at around the current price. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

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.

Have Ready Capital Insiders Traded Recently?

In the last three months, CFO & Secretary Andrew Ahlborn bought US$7.4k. However that only slightly eclipses the sales, US$5.1k worth of sales. Overall, we don't think these recent trades are particularly informative, one way or the other.

Insider Ownership Of Ready Capital

Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. Insiders own 12% of Ready Capital shares, worth about US$35m. 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 Ready Capital Insiders?

Our data shows a little insider buying, but no selling, in the last three months. Overall the buying isn't worth writing home about. However, our analysis of transactions over the last year is heartening. Insiders own shares in Ready Capital and we see no evidence to suggest they are worried about the future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Ready Capital.

But note: Ready Capital may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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.

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.