Samuel Duddy of Freehill Mining Limited (ASX:FHS) Just Spent AU$74k On Shares

Whilst it may not be a huge deal, we thought it was good to see that Samuel Duddy, who is a company insider, recently bought AU$74k worth of stock, for AU$0.027 per share. However, we do note that it only increased their holding by 1.4%, and it wasn’t a huge purchase by absolute value, either.

Check out our latest analysis for Freehill Mining

Freehill Mining Insider Transactions Over The Last Year

Notably, that recent purchase by insider Samuel Duddy was not the only time they bought Freehill Mining shares this year. Earlier in the year, they paid AU$0.011 per share in a AU$611k purchase. We do like to see buying, but this purchase was made at well below the current price of AU$0.02. Because it occurred at a lower valuation, it doesn’t tell us much about whether insiders might find today’s price attractive.

In the last twelve months Freehill Mining insiders were buying shares, but not selling. They paid about AU$0.012 on average. We don’t deny that it is nice to see insiders buying stock in the company. However, you should keep in mind that they bought when the share price was meaningfully below today’s levels. You can see a visual depiction of insider transactions (by 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!

ASX:FHS Recent Insider Trading March 30th 2020
ASX:FHS Recent Insider Trading March 30th 2020

There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).

Does Freehill Mining Boast High Insider Ownership?

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. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that Freehill Mining insiders own 21% of the company, worth about AU$5.8m. 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 Does This Data Suggest About Freehill Mining Insiders?

It is good to see the recent insider purchase. We also take confidence from the longer term picture of insider transactions. However, we note that the company didn’t make a profit over the last twelve months, which makes us cautious. Insiders likely see value in Freehill Mining shares, given these transactions (along with notable insider ownership of the company). 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. To help with this, we’ve discovered 7 warning signs (4 make us uncomfortable!) that you ought to be aware of before buying any shares in Freehill Mining.

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, but not derivative transactions.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.