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MD & Executive Director Charles Bass Just Bought A Handful Of Shares In Eagle Mountain Mining Limited (ASX:EM2)

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Whilst it may not be a huge deal, we thought it was good to see that the Eagle Mountain Mining Limited (ASX:EM2) MD & Executive Director, Charles Bass, recently bought AU$76k worth of stock, for AU$0.23 per share. Nevertheless, it only increased their shareholding by a minuscule percentage, and it wasn't a massive purchase by absolute value, either.

View our latest analysis for Eagle Mountain Mining

The Last 12 Months Of Insider Transactions At Eagle Mountain Mining

In fact, the recent purchase by MD & Executive Director Charles Bass was not their only acquisition of Eagle Mountain Mining shares this year. Earlier in the year, they paid AU$0.45 per share in a AU$1m purchase. So it's clear an insider wanted to buy, even at a higher price than the current share price (being AU$0.23). It's very possible they regret the purchase, but it's more likely they are bullish about the company. To us, it's very important to consider the price insiders pay for shares. As a general rule, we feel more positive about a stock when an insider has bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price. The only individual insider to buy over the last year was Charles Bass.

Charles Bass bought 3.45m shares over the last 12 months at an average price of AU$0.47. 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

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.

Insider Ownership Of Eagle Mountain Mining

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 27% of Eagle Mountain Mining shares, worth about AU$17m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

What Might The Insider Transactions At Eagle Mountain Mining Tell Us?

It is good 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 during the last year, which makes us a little cautious. Insiders likely see value in Eagle Mountain Mining shares, given these transactions (along with notable insider ownership of the company). 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. To help with this, we've discovered 6 warning signs (2 don't sit too well with us!) that you ought to be aware of before buying any shares in Eagle Mountain Mining.

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.

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

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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