Trigg Minerals Limited (ASX:TMG) insiders who acquired shares over the previous 12 months, can probably afford to ignore the recent 12% decline in the stock price. After accounting for the recent loss, the AU$700.1k worth of shares they purchased is now worth AU$2.36m, suggesting a good return on their investment.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
Check out our latest analysis for Trigg Minerals
The insider Yonglu Yu made the biggest insider purchase in the last 12 months. That single transaction was for AU$357k worth of shares at a price of AU$0.007 each. We do like to see buying, but this purchase was made at well below the current price of AU$0.029. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.
Over the last year, we can see that insiders have bought 81.51m shares worth AU$700k. But they sold 1.00m shares for AU$11k. In the last twelve months there was more buying than selling by Trigg Minerals insiders. Their average price was about AU$0.0086. To my mind it is good that insiders have invested their own money in the company. However, we do note that they were buying at significantly lower prices than today's share price. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Trigg Minerals 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.
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. It appears that Trigg Minerals insiders own 24% of the company, worth about AU$5.7m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
The fact that there have been no Trigg Minerals insider transactions recently certainly doesn't bother us. But insiders have shown more of an appetite for the stock, over the last year. Insiders own shares in Trigg Minerals and we see no evidence to suggest they are worried about the future. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. To that end, you should learn about the 5 warning signs we've spotted with Trigg Minerals (including 4 which make us uncomfortable).
Of course Trigg Minerals may not be the best stock to buy. So you may wish to see this free collection of high quality 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.
Discover if Trigg Minerals might be undervalued or overvalued with our detailed analysis, featuring fair value estimates, potential risks, dividends, insider trades, and its financial condition.
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