Potential GBM Resources Limited (ASX:GBZ) shareholders may wish to note that the MD, CEO & Executive Director, Peter Rohner, recently bought AU$174k worth of stock, paying AU$0.035 for each share. We reckon that's a good sign, especially since the purchase boosted their holding by 313%.
The Last 12 Months Of Insider Transactions At GBM Resources
Notably, that recent purchase by Peter Rohner is the biggest insider purchase of GBM Resources shares that we've seen in the last year. We do like to see buying, but this purchase was made at well below the current price of AU$0.07. 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.
Peter Rohner bought a total of 5.03m shares over the year at an average price of AU$0.035. You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
GBM Resources 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 GBM Resources
For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It appears that GBM Resources insiders own 34% of the company, worth about AU$4.6m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
So What Do The GBM Resources Insider Transactions Indicate?
It's certainly positive to see the recent insider purchase. And the longer term insider transactions also give us confidence. But on the other hand, the company made a loss last year, which makes us a little cautious. When combined with notable insider ownership, these factors suggest GBM Resources insiders are well aligned, and that they may think the share price is too low. Along with insider transactions, I recommend checking if GBM Resources is growing revenue. This free chart of historic revenue and earnings should make that easy.
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.
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