With Pioneer Minerals Up 32%, Insider Buyers Count Their Returns

Insiders who bought Pioneer Minerals Limited (ASX:PMM) stock in the last 12 months were richly rewarded last week. The company's market value increased by AU$2.9m as a result of the stock's 32% gain over the same period. In other words, the original AU$342.5k purchase is now worth AU$552.6k.

While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

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Pioneer Minerals Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider purchase was by Independent Non-Executive Chairman Agha Pervez for AU$100k worth of shares, at about AU$0.14 per share. Even though the purchase was made at a significantly lower price than the recent price (AU$0.18), we still think insider buying is a positive. 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.

While Pioneer Minerals insiders bought shares during the last year, they didn't sell. Their average price was about AU$0.11. We don't deny that it is nice to see insiders buying stock in the company. However, you should keep in mind that they bought when the share price was meaningfully below today's levels. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

See our latest analysis for Pioneer Minerals

There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).

Insiders At Pioneer Minerals Have Bought Stock Recently

It's good to see that Pioneer Minerals insiders have made notable investments in the company's shares. Specifically, Independent Non-Executive Chairman Agha Pervez bought AU$100k worth of shares in that time, and we didn't record any sales whatsoever. This is a positive in our book as it implies some confidence.

Insider Ownership

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. It's great to see that Pioneer Minerals insiders own 51% of the company, worth about AU$6.1m. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

What Might The Insider Transactions At Pioneer Minerals Tell Us?

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 during the last year, which makes us a little cautious. When combined with notable insider ownership, these factors suggest Pioneer Minerals insiders are well aligned, and quite possibly think the share price is too low. That's what I like to see! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Pioneer Minerals. At Simply Wall St, we've found that Pioneer Minerals has 5 warning signs (3 can't be ignored!) that deserve your attention before going any further with your analysis.

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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 of direct interests only, but not derivative transactions or indirect interests.

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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.