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Did Tudor Gold Corp. (CVE:TUD) Insiders Buy Up More Shares?

Simply Wall St
·4 mins read

We often see insiders buying up shares in companies that perform well over the long term. On the other hand, we'd be remiss not to mention that insider sales have been known to precede tough periods for a business. So we'll take a look at whether insiders have been buying or selling shares in Tudor Gold Corp. (CVE:TUD).

Do Insider Transactions Matter?

It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, such insiders must disclose their trading activities, and not trade on inside information.

Insider transactions are not the most important thing when it comes to long-term investing. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year'.

Check out our latest analysis for Tudor Gold

The Last 12 Months Of Insider Transactions At Tudor Gold

The insider Eric Sprott made the biggest insider purchase in the last 12 months. That single transaction was for CA$6.2m worth of shares at a price of CA$0.94 each. Even though the purchase was made at a significantly lower price than the recent price (CA$3.12), we still think insider buying is a positive. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.

Happily, we note that in the last year insiders paid CA$9.4m for 11.42m shares. On the other hand they divested 200.00k shares, for CA$643k. In the last twelve months there was more buying than selling by Tudor Gold insiders. The average buy price was around CA$0.83. We don't deny that it is nice to see insiders buying stock in the company. However, you should keep in mind that they bought when the share price was meaningfully below today's levels. 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!

insider-trading-volume
insider-trading-volume

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

Insiders at Tudor Gold Have Bought Stock Recently

At Tudor Gold,over the last quarter, we have observed quite a lot more insider buying than insider selling. In fact, two insiders bought CA$7.4m worth of shares. But we did see insider Catalin Kilofliski sell shares worth CA$643k. The buying outweighs the selling, which suggests that insiders may believe the company will do well in the future.

Insider Ownership

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. It appears that Tudor Gold insiders own 20% of the company, worth about CA$109m. 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 Tudor Gold Insiders?

It's certainly positive to see the recent insider purchases. And an analysis of the transactions over the last year also gives us confidence. But on the other hand, the company made a loss during the last year, which makes us a little cautious. Once you factor in the high insider ownership, it certainly seems like insiders are positive about Tudor Gold. That's what I like to see! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Tudor Gold. To help with this, we've discovered 3 warning signs (1 makes us a bit uncomfortable!) that you ought to be aware of before buying any shares in Tudor Gold.

But note: Tudor Gold 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, but not derivative transactions.

This article by Simply Wall St is general in nature. 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.

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