Insider Buying: The Rafaella Resources Limited (ASX:RFR) Non-Independent Non-Executive Director Just Bought 93% More Shares
Whilst it may not be a huge deal, we thought it was good to see that the Rafaella Resources Limited (ASX:RFR) Non-Independent Non-Executive Director, Robert Wrixon, recently bought AU$100k worth of stock, for AU$0.023 per share. While that isn't the hugest buy, it actually boosted their shareholding by 93%, which is good to see.
View our latest analysis for Rafaella Resources
The Last 12 Months Of Insider Transactions At Rafaella Resources
In the last twelve months, the biggest single purchase by an insider was when insider Kenneth Hall bought AU$435k worth of shares at a price of AU$0.073 per share. That means that an insider was happy to buy shares at above the current price of AU$0.03. It's very possible they regret the purchase, but it's more likely they are bullish about the company. We always take careful note of the price insiders pay when purchasing shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.
In the last twelve months Rafaella Resources insiders were buying shares, but not selling. The average buy price was around AU$0.052. These transactions suggest that insiders have considered the current price attractive. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
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).
Does Rafaella Resources Boast High 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. Our data indicates that Rafaella Resources insiders own about AU$1.3m worth of shares (which is 13% of the company). But they may have an indirect interest through a corporate structure that we haven't picked up on. Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!
So What Do The Rafaella Resources Insider Transactions Indicate?
It's certainly positive to see the recent insider purchases. We also take confidence from the longer term picture of insider transactions. But on the other hand, the company made a loss during the last year, which makes us a little cautious. We would certainly prefer see higher levels of insider ownership but analysis of the insider transactions suggests that Rafaella Resources insiders are expecting a bright future. 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. For instance, we've identified 6 warning signs for Rafaella Resources (5 shouldn't be ignored) you should be aware of.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.
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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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