Astral Resources Insider Buyers See Boost After Market Cap Rose AU$28m

Astral Resources NL (ASX:AAR) insiders who purchased shares in the last 12 months were richly rewarded last week. The stock climbed by 14% resulting in a AU$28m addition to the company’s market value. As a result, the stock they originally bought for AU$2.64m is now worth AU$5.98m.

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.

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Astral Resources Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when insider Simon Braham bought AU$2.5m worth of shares at a price of AU$0.073 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of AU$0.17. 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 Astral Resources insiders were buying shares, but not selling. 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!

Check out our latest analysis for Astral Resources

Astral Resources is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.

Insider Ownership Of Astral Resources

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It appears that Astral Resources insiders own 15% of the company, worth about AU$35m. 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 Astral Resources Insiders?

It doesn't really mean much that no insider has traded Astral Resources shares in the last quarter. But insiders have shown more of an appetite for the stock, over the last year. Insiders own shares in Astral Resources and we see no evidence to suggest they are worried about the future. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Case in point: We've spotted 4 warning signs for Astral Resources you should be aware of, and 3 of these don't sit too well with us.

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.