Last week, Grosvenor Resource Corporation( CVE:GVR ) insiders, who had purchased shares in the previous 12 months were rewarded handsomely. The shares increased by 120% last week, resulting in a CA$2.3m increase in the company's market worth, implying a 121% gain on their initial purchase. As a result, the stock they originally bought for CA$326.8k is now worth CA$720.5k.
While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.
Grosvenor Resource Insider Transactions Over The Last Year
Notably, that recent purchase by Ian Rozier is the biggest insider purchase of Grosvenor Resource shares that we've seen in the last year. Even though the purchase was made at a significantly lower price than the recent price (CA$0.11), we still think insider buying is a positive. 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.
Ian Rozier purchased 6.55m shares over the year. The average price per share was CA$0.05. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Check out our latest analysis for Grosvenor Resource
Grosvenor Resource 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.
Insider Ownership
For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Grosvenor Resource insiders own 48% of the company, currently worth about CA$1.9m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
So What Do The Grosvenor Resource Insider Transactions Indicate?
The recent insider purchase is heartening. 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. When combined with notable insider ownership, these factors suggest Grosvenor Resource insiders are well aligned, and quite possibly think the share price is too low. Nice! 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. When we did our research, we found 5 warning signs for Grosvenor Resource (4 shouldn't be ignored!) that we believe deserve your full attention.
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.
