Eric Sprott Just Bought 24% More Shares In Golden Tag Resources Ltd. (CVE:GOG)

Those following along with Golden Tag Resources Ltd. (CVE:GOG) will no doubt be intrigued by the recent purchase of shares by insider Eric Sprott, who spent a stonking CA$2.0m on stock at an average price of CA$0.56. Not only is that a big swing, but it increased their holding size by 24%, which is definitely great to see.

Check out our latest analysis for Golden Tag Resources

Golden Tag Resources Insider Transactions Over The Last Year

In fact, the recent purchase by Eric Sprott was the biggest purchase of Golden Tag Resources shares made by an insider individual in the last twelve months, according to our records. That means that an insider was happy to buy shares at above the current price of CA$0.12. Their view may have changed since then, but at least it shows they felt optimistic at the time. 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.

Golden Tag Resources insiders may have bought shares in the last year, but they didn't sell any. They paid about CA$0.16 on average. These transactions suggest that insiders have considered the current price attractive. You can see the insider transactions (by 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 growing companies that insiders are buying.

Does Golden Tag Resources Boast High Insider Ownership?

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. It appears that Golden Tag Resources insiders own 24% of the company, worth about CA$3.6m. 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 Golden Tag Resources Insider Transactions Indicate?

The recent insider purchase is heartening. And the longer term insider transactions also give 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 Golden Tag Resources insiders are well aligned, and that they may think the share price is too low. 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. Be aware that Golden Tag Resources is showing 3 warning signs in our investment analysis, and 1 of those is significant...

Of course Golden Tag 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. 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. Thank you for reading.