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How Much Are Equinox Gold Corp. (TSE:EQX) Insiders Spending On Buying Shares?

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Simply Wall St
·4 min read
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It is not uncommon to see companies perform well in the years after insiders buy shares. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So shareholders might well want to know whether insiders have been buying or selling shares in Equinox Gold Corp. (TSE:EQX).

What Is Insider Selling?

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.

Insider transactions are not the most important thing when it comes to long-term investing. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Columbia University study found that 'insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers'.

See our latest analysis for Equinox Gold

Equinox Gold Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider purchase was by Independent Chairman Ross Beaty for CA$50m worth of shares, at about CA$8.51 per share. Even though the purchase was made at a significantly lower price than the recent price (CA$11.96), we still think insider buying is a positive. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

In the last twelve months insiders purchased 5.84m shares for CA$50m. But they sold 785.40k shares for CA$7.3m. In total, Equinox Gold insiders bought more than they sold over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

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.

Equinox Gold Insiders Are Selling The Stock

The last three months saw significant insider selling at Equinox Gold. In total, Independent Chairman Ross Beaty dumped CA$1m worth of shares in that time, and we didn't record any purchases whatsoever. Overall this makes us a bit cautious, but it's not the be all and end all.

Does Equinox Gold 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. Equinox Gold insiders own 8.3% of the company, currently worth about CA$246m based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Do The Equinox Gold Insider Transactions Indicate?

An insider sold Equinox Gold shares recently, but they didn't buy any. But we take heart from prior transactions. We are also comforted by the high levels of insider ownership. So we're not too bothered by recent selling. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For example, Equinox Gold has 2 warning signs (and 1 which is concerning) we think you should know about.

But note: Equinox Gold 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.

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.

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