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Quite a few insiders invested in Redbank Copper Limited (ASX:RCP) last year which is positive news for shareholders

When a single insider purchases stock, it is typically not a major deal. However, when multiple insiders purchase stock, like in Redbank Copper Limited's (ASX:RCP) instance, it's good news for shareholders.

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.

View our latest analysis for Redbank Copper

The Last 12 Months Of Insider Transactions At Redbank Copper

In the last twelve months, the biggest single purchase by an insider was when Independent Non-Executive Chairman Anthony Kiernan bought AU$77k worth of shares at a price of AU$0.10 per share. That means that an insider was happy to buy shares at above the current price of AU$0.049. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. 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.

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While Redbank Copper insiders bought shares during the last year, they didn't sell. They paid about AU$0.063 on average. 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. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

insider-trading-volume
insider-trading-volume

Redbank Copper 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.

Redbank Copper Insiders Bought Stock Recently

It's good to see that Redbank Copper insiders have made notable investments in the company's shares. Not only was there no selling that we can see, but they collectively bought AU$124k worth of shares. That shows some optimism about the company's future.

Insider Ownership of Redbank Copper

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. Redbank Copper insiders own about AU$7.0m worth of shares. That equates to 28% of the company. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Do The Redbank Copper Insider Transactions Indicate?

It's certainly positive to see the recent insider purchases. And an analysis of the transactions over the last year also gives us confidence. But on the other hand, the company made a loss during the last year, which makes us a little cautious. Insiders likely see value in Redbank Copper shares, given these transactions (along with notable insider ownership 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. To that end, you should learn about the 5 warning signs we've spotted with Redbank Copper (including 2 which don't sit too well with us).

But note: Redbank Copper 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.