Have Insiders Been Buying Kingwest Resources Limited (ASX:KWR) Shares This Year?
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 shareholders might well want to know whether insiders have been buying or selling shares in Kingwest Resources Limited (ASX:KWR).
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, rules govern insider transactions, and certain disclosures are required.
We don't think shareholders should simply follow insider transactions. But equally, we would consider it foolish to ignore insider transactions altogether. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.
See our latest analysis for Kingwest Resources
The Last 12 Months Of Insider Transactions At Kingwest Resources
Over the last year, we can see that the biggest insider purchase was by insider Peter Bennetto for AU$80k worth of shares, at about AU$0.15 per share. So it's clear an insider wanted to buy, at around the current price, which is AU$0.18. Of course they may have changed their mind. But this suggests they are optimistic. We do always like to see insider buying, but it is worth noting if those purchases were made at well below today's share price, as the discount to value may have narrowed with the rising price. In this case we're pleased to report that the insider purchases were made at close to current prices.
Kingwest Resources insiders may have bought shares in the last year, but they didn't sell any. The average buy price was around AU$0.19. This is nice to see since it implies that insiders might see value around current prices. You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Kingwest Resources is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Does Kingwest 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. A high insider ownership often makes company leadership more mindful of shareholder interests. Our data indicates that Kingwest Resources insiders own about AU$1.1m worth of shares (which is 5.8% of the company). We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. Whilst better than nothing, we're not overly impressed by these holdings.
So What Do The Kingwest Resources Insider Transactions Indicate?
It doesn't really mean much that no insider has traded Kingwest Resources shares in the last quarter. But insiders have shown more of an appetite for the stock, over the last year. The transactions are fine but it'd be more encouraging if Kingwest Resources insiders bought more shares in the company. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. When we did our research, we found 5 warning signs for Kingwest Resources (2 can't be ignored!) that we believe deserve your full attention.
Of course Kingwest Resources may not be the best stock to buy. So you may wish to see this free collection of high quality 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.
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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. Thank you for reading.
