Insiders who purchased Midas Minerals Limited (ASX:MM1) shares in the past 12 months are unlikely to be deeply impacted by the stock’s 18% decline over the past week. Even after accounting for the recent loss, the AU$347k worth of stock purchased by them is now worth AU$1.0m or in other words, their investment continues to give good returns.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
Midas Minerals Insider Transactions Over The Last Year
The insider Mark Calderwood made the biggest insider purchase in the last 12 months. That single transaction was for AU$347k worth of shares at a price of AU$0.20 each. Even though the purchase was made at a significantly lower price than the recent price (AU$0.28), we still think insider buying is a positive. Because the shares were purchased at a lower price, this particular buy doesn’t tell us much about how insiders feel about the current share price.
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!
Midas Minerals is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. 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 Midas Minerals insiders own 29% of the company, worth about AU$5.2m. 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 Do The Midas Minerals Insider Transactions Indicate?
There haven’t been any insider transactions in the last three months — that doesn’t mean much. But insiders have shown more of an appetite for the stock, over the last year. Overall we don’t see anything to make us think Midas Minerals insiders are doubting the company, and they do own shares. In addition to knowing about insider transactions going on, it’s beneficial to identify the risks facing Midas Minerals. To that end, you should learn about the 3 warning signs we’ve spotted with Midas Minerals (including 1 which is potentially serious).
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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, but not derivative transactions.
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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.
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