Challenger Gold Insider Buyers Pleased With AU$3.0m Return On Investment
Insiders who purchased Challenger Gold Limited (ASX:CEL) shares in the past 12 months are unlikely to be deeply impacted by the stock's 10% decline over the past week. Reason being, despite the recent loss, insiders original purchase value of AU$7.58m is now worth AU$10.6m.
While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.
The Last 12 Months Of Insider Transactions At Challenger Gold
The Non-Executive Chairman Eduardo Sergio Elsztain made the biggest insider purchase in the last 12 months. That single transaction was for AU$7.5m worth of shares at a price of AU$1.60 each. We do like to see buying, but this purchase was made at well below the current price of AU$2.24. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.
Happily, we note that in the last year insiders paid AU$7.6m for 4.74m shares. On the other hand they divested 60.00k shares, for AU$132k. In the last twelve months there was more buying than selling by Challenger Gold insiders. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Check out our latest analysis for Challenger Gold
Challenger Gold is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.
Insider Ownership
Many investors like to check how much of a company is owned by 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. Insiders own 15% of Challenger Gold shares, worth about AU$47m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
So What Do The Challenger Gold Insider Transactions Indicate?
It doesn't really mean much that no insider has traded Challenger Gold shares in the last quarter. But insiders have shown more of an appetite for the stock, over the last year. Overall we don't see anything to make us think Challenger Gold insiders are doubting the company, and they do own shares. 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 instance, we've identified 2 warning signs for Challenger Gold (1 makes us a bit uncomfortable) you should be aware of.
But note: Challenger 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 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.