Insiders Give Up CA$254k As Search Minerals Stock Drops To CA$0.13
The recent 26% drop in Search Minerals Inc.'s (CVE:SMY) stock could come as a blow to insiders who purchased CA$542.7k worth of stock at an average buy price of CA$0.24 over the past 12 months. Insiders purchase with the hope of seeing their investments increase in value over time. However, due to recent losses, their initial investment is now only worth CA$288.8k, which is not great.
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 Search Minerals
Over the last year, we can see that the biggest insider purchase was by Independent Director Michael Pearson for CA$199k worth of shares, at about CA$0.25 per share. That means that even when the share price was higher than CA$0.13 (the recent price), an insider wanted to purchase shares. It's very possible they regret the purchase, but it's more likely they are bullish about the company. In our view, the price an insider pays for shares is very important. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.
In the last twelve months Search Minerals insiders were buying shares, but not selling. 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!
See our latest analysis for Search Minerals
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.
Search Minerals Insiders Bought Stock Recently
It's good to see that Search Minerals insiders have made notable investments in the company's shares. Overall, two insiders shelled out CA$244k for shares in the company -- and none sold. This makes one think the business has some good points.
Does Search Minerals Boast High Insider Ownership?
Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that Search Minerals insiders own 39% of the company, worth about CA$2.9m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
What Might The Insider Transactions At Search Minerals Tell Us?
The recent insider purchases are heartening. We also take confidence from the longer term picture of insider transactions. But we don't feel the same about the fact the company is making losses. When combined with notable insider ownership, these factors suggest Search Minerals insiders are well aligned, and that they may think the share price is too low. 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, Search Minerals has 3 warning signs (and 2 which are potentially serious) we think you should know about.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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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