Have Founders Metals Insiders Been Selling Stock?

We'd be surprised if Founders Metals Inc. (CVE:FDR) shareholders haven't noticed that the Independent Director, George Bonnell, recently sold CA$363k worth of stock at CA$1.45 per share. However, the silver lining is that the sale only reduced their total holding by 7.1%, so we're hesitant to read anything much into it, on its own.

Check out our latest analysis for Founders Metals

Founders Metals Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the insider, Justin Bourassa, for CA$467k worth of shares, at about CA$1.00 per share. That means that an insider was selling shares at slightly below the current price (CA$1.52). As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. It is worth noting that this sale was 86% of Justin Bourassa's holding.

All up, insiders sold more shares in Founders Metals than they bought, over the last year. 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!

For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Insider Ownership Of Founders Metals

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. It appears that Founders Metals insiders own 16% of the company, worth about CA$15m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

What Might The Insider Transactions At Founders Metals Tell Us?

An insider sold Founders Metals shares recently, but they didn't buy any. Despite some insider buying, the longer term picture doesn't make us feel much more positive. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. So we'd only buy after careful consideration. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Our analysis shows 6 warning signs for Founders Metals (3 can't be ignored!) and we strongly recommend you look at these before investing.

But note: Founders Metals 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 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.