Bullish Gold Mountain Insiders Loaded Up On AU$1.17m Of Stock
Multiple insiders secured a larger position in Gold Mountain Limited (ASX:GMN) shares over the last 12 months. This is reassuring as this suggests that insiders have increased optimism about the company's prospects.
While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
Check out our latest analysis for Gold Mountain
The Last 12 Months Of Insider Transactions At Gold Mountain
The insider Chunyan Niu made the biggest insider purchase in the last 12 months. That single transaction was for AU$1.0m worth of shares at a price of AU$0.0092 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being AU$0.005). 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. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.
Gold Mountain insiders may have bought shares in the last year, but they didn't sell any. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).
Insider Ownership
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. Insiders own 18% of Gold Mountain shares, worth about AU$2.1m. 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 Gold Mountain Insiders?
It doesn't really mean much that no insider has traded Gold Mountain shares in the last quarter. On a brighter note, the transactions over the last year are encouraging. Insiders do have a stake in Gold Mountain and their transactions don't cause us concern. While we like knowing 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 help with this, we've discovered 5 warning signs (4 don't sit too well with us!) that you ought to be aware of before buying any shares in Gold Mountain.
But note: Gold Mountain 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.
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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.
