Yahoo Finance Insider Purchases Worth AU$2.21m See Losses As NICO Resources Market Value Drops To AU$13m
The recent 11% drop in NICO Resources Limited's (ASX:NC1) stock could come as a blow to insiders who purchased AU$2.21m worth of stock at an average buy price of AU$0.32 over the past 12 months. Insiders invest with the hopes of seeing their money grow in value over time. However, as a result of recent losses, their initial investment is now only worth AU$832.7k, which is not what they expected.
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.
See our latest analysis for NICO Resources
The Last 12 Months Of Insider Transactions At NICO Resources
In the last twelve months, the biggest single purchase by an insider was when Non-Executive Chairman Peter Cook bought AU$1.0m worth of shares at a price of AU$0.40 per share. That means that an insider was happy to buy shares at above the current price of AU$0.12. It's very possible they regret the purchase, but it's more likely they are bullish about the company. 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 6.94m shares for AU$2.2m. But they sold 200.00k shares for AU$28k. In the last twelve months there was more buying than selling by NICO Resources insiders. Their average price was about AU$0.32. These transactions suggest that insiders have considered the current price attractive. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!
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.
Insiders At NICO Resources Have Sold Stock Recently
The last three months saw some NICO Resources insider selling. Non-Executive Director Roderick Corps divested only AU$28k worth of shares in that time. It's not great to see insider selling, nor the lack of recent buyers. But the selling simply isn't sufficiently substantial to be of much use as a signal.
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. I reckon it's a good sign if insiders own a significant number of shares in the company. It appears that NICO Resources insiders own 31% of the company, worth about AU$4.1m. 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 NICO Resources Insiders?
Our data shows a little more insider selling, but no insider buying, in the last three months. But the sales were small, so we're not concerned. On a brighter note, the transactions over the last year are encouraging. Insiders do have a stake in NICO Resources 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. For example, NICO Resources has 5 warning signs (and 4 which are concerning) 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.
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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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