Yahoo Finance Magmatic Resources Insiders Added AU$2.2m Of Stock To Their Holdings
In the last year, multiple insiders have substantially increased their holdings of Magmatic Resources Limited (ASX:MAG) stock, indicating that insiders' optimism about the company's prospects has increased.
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.
See our latest analysis for Magmatic Resources
Magmatic Resources Insider Transactions Over The Last Year
The insider Yiu Ming made the biggest insider purchase in the last 12 months. That single transaction was for AU$885k worth of shares at a price of AU$0.19 each. That means that an insider was happy to buy shares at above the current price of AU$0.06. 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. We note that Yiu Ming was both the biggest buyer and the biggest seller.
In the last twelve months insiders purchased 18.45m shares for AU$2.2m. On the other hand they divested 1.45m shares, for AU$232k. Overall, Magmatic Resources insiders were net buyers during the last year. They paid about AU$0.12 on average. This is nice to see since it implies that insiders might see value around current prices. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Magmatic Resources is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Have Magmatic Resources Insiders Traded Recently?
Over the last three months, we've seen a bit of insider buying at Magmatic Resources. MD & Director Adam McKinnon shelled out AU$7.8k for shares in that time. It's great to see that insiders are only buying, not selling. But the amount invested in the last three months isn't enough for us too put much weight on it, as a single factor.
Does Magmatic Resources Boast High Insider Ownership?
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. Magmatic Resources insiders own about AU$7.3m worth of shares (which is 40% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
So What Do The Magmatic Resources Insider Transactions Indicate?
Our data shows a little insider buying, but no selling, in the last three months. The net investment is not enough to encourage us much. On a brighter note, the transactions over the last year are encouraging. With high insider ownership and encouraging transactions, it seems like Magmatic Resources insiders think the business has merit. While we like knowing 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. Our analysis shows 4 warning signs for Magmatic Resources (2 are a bit concerning!) and we strongly recommend you look at these before investing.
Of course Magmatic Resources 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, but not derivative transactions.
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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.
