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Consolidated Zinc Limited (ASX:CZL) drops to AU$8.5m and insiders who purchased earlier this year lose another US$101k

·3 min read

The recent price decline of 12% in Consolidated Zinc Limited's (ASX:CZL) stock may have disappointed insiders who bought US$387k worth of shares at an average price of US$0.03 in the past 12 months. Insiders invest with the hopes of seeing their money grow in value over time. However, as a result of recent losses, their initial investment is now only worth US$286k, which is not what they expected.

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.

View our latest analysis for Consolidated Zinc

Consolidated Zinc Insider Transactions Over The Last Year

The insider Stephen Copulos made the biggest insider purchase in the last 12 months. That single transaction was for AU$122k worth of shares at a price of AU$0.043 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being AU$0.022). It's very possible they regret the purchase, but it's more likely they are bullish about the company. To us, it's very important to consider the price insiders pay for shares. It is encouraging to see an insider paid above the current price for shares, as it suggests they saw value, even at higher levels. Stephen Copulos was the only individual insider to buy during the last year.

Stephen Copulos purchased 13.00m shares over the year. The average price per share was AU$0.03. 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!

insider-trading-volume
insider-trading-volume

Consolidated Zinc is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Insider Ownership Of Consolidated Zinc

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 21% of Consolidated Zinc shares, worth about AU$1.8m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Do The Consolidated Zinc Insider Transactions Indicate?

The fact that there have been no Consolidated Zinc insider transactions recently certainly doesn't bother us. On a brighter note, the transactions over the last year are encouraging. Insiders do have a stake in Consolidated Zinc and their transactions don't cause us concern. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Consolidated Zinc. To help with this, we've discovered 5 warning signs (3 are a bit concerning!) that you ought to be aware of before buying any shares in Consolidated Zinc.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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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