Even if it's not a huge purchase, we think it was good to see that Clive Johnson, the Director of BeMetals Corp. (CVE:BMET) recently shelled out CA$59k to buy stock, at CA$0.21 per share. However, we do note that it only increased their holding by 3.2%, and it wasn't a huge purchase by absolute value, either.
BeMetals Insider Transactions Over The Last Year
In fact, the recent purchase by Director Clive Johnson was not their only acquisition of BeMetals shares this year. They previously made an even bigger purchase of CA$75k worth of shares at a price of CA$0.25 per share. That means that an insider was happy to buy shares at above the current price of CA$0.20. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. We always take careful note of the price insiders pay when purchasing shares. 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.
BeMetals insiders may have bought shares in the last year, but they didn't sell any. The chart below shows insider transactions (by individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
BeMetals is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Insider Ownership of BeMetals
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. BeMetals insiders own about CA$3.8m worth of shares. That equates to 18% of the company. 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 BeMetals Insiders?
The recent insider purchases are heartening. And an analysis of the transactions over the last year also gives us confidence. But we don't feel the same about the fact the company is making losses. Insiders likely see value in BeMetals shares, given these transactions (along with notable insider ownership of the company). I like to dive deeper into how a company has performed in the past. You can access this interactive graph of past earnings, revenue and cash flow for free.
But note: BeMetals 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.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.