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Duketon Mining Limited (ASX:DKM) insiders who purchased shares in the last 12 months were richly rewarded last week. The stock climbed by 24% resulting in a AU$12m addition to the company’s market value. Put another way, the original AU$975k acquisition is now worth AU$1.7m.
Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.
Duketon Mining Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider purchase was by Independent Non-Executive Chairman Seamus Cornelius for AU$810k worth of shares, at about AU$0.28 per share. We do like to see buying, but this purchase was made at well below the current price of AU$0.49. 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.
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!
I will like Duketon Mining better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. It appears that Duketon Mining insiders own 17% of the company, worth about AU$9.8m. 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 Duketon Mining Insider Transactions Indicate?
Insider buying and selling have balanced each other out in the last three months, so we can't deduct anything useful from these recent trades. Recent insider selling makes us a little nervous, in light of the broader picture of Duketon Mining insider transactions. But we do like the fact that insiders own a fair chunk of the company. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Our analysis shows 7 warning signs for Duketon Mining (1 is significant!) and we strongly recommend you look at them before investing.
But note: Duketon Mining 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, but not derivative transactions.
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.
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