Insider Purchases Worth US$3.17m See Losses As Genmin Market Value Drops To AU$14m
The recent 20% drop in Genmin Limited's (ASX:GEN) stock could come as a blow to insiders who purchased US$3.17m worth of stock at an average buy price of US$0.0099 over the past 12 months. This is not good as insiders invest based on expectations that their money will appreciate over time. However, as a result of recent losses, their original investment is now worth only US$1.28m.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.
Genmin Insider Transactions Over The Last Year
The Executive Chair Gregory Lilleyman made the biggest insider purchase in the last 12 months. That single transaction was for AU$3.1m worth of shares at a price of AU$0.01 each. That means that an insider was happy to buy shares at above the current price of AU$0.004. 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. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.
Genmin insiders may have bought shares in the last year, but they didn't sell any. 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 Genmin
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.
Does Genmin Boast High 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. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 36% of Genmin shares, worth about AU$5.0m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
So What Does This Data Suggest About Genmin Insiders?
It doesn't really mean much that no insider has traded Genmin shares in the last quarter. However, our analysis of transactions over the last year is heartening. Insiders do have a stake in Genmin and their transactions don't cause us concern. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. To assist with this, we've discovered 6 warning signs that you should run your eye over to get a better picture of Genmin.
But note: Genmin 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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