Insiders Re-Evaluate Their CA$1.53m Stock Purchase As Resouro Strategic Metals Falls To CA$26m
The recent 10% drop in Resouro Strategic Metals Inc.'s (CVE:RSM) stock could come as a blow to insiders who purchased CA$1.53m worth of stock at an average buy price of CA$0.25 over the past 12 months. Insiders buy with the expectation to see their investments rise in value over a period of time. However, recent losses have rendered their above investment worth CA$1.32m which is not ideal.
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.
Resouro Strategic Metals Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when insider José Luis Manzano bought CA$699k worth of shares at a price of CA$0.24 per share. That means that an insider was happy to buy shares at above the current price of CA$0.22. Their view may have changed since then, but at least it shows they felt optimistic at the time. We always take careful note of the price insiders pay when purchasing shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.
In the last twelve months insiders purchased 5.99m shares for CA$1.5m. On the other hand they divested 50.00k shares, for CA$20k. Overall, Resouro Strategic Metals insiders were net buyers during the last year. 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!
Check out our latest analysis for Resouro Strategic Metals
Resouro Strategic Metals 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.
Insiders At Resouro Strategic Metals Have Bought Stock Recently
It's good to see that Resouro Strategic Metals insiders have made notable investments in the company's shares. We can see that insider José Luis Manzano paid CA$565k for shares in the company. No-one sold. This makes one think the business has some good points.
Does Resouro Strategic Metals Boast High Insider Ownership?
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that Resouro Strategic Metals insiders own 39% of the company, worth about CA$10m. 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 Does This Data Suggest About Resouro Strategic Metals Insiders?
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 Resouro Strategic Metals shares, given these transactions (along with notable insider ownership of the company). So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. For example, Resouro Strategic Metals has 4 warning signs (and 2 which are a bit unpleasant) we think you should know about.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.
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.