Insider Buyers Lose AU$43k As Adelong Gold Sheds AU$1.1m

Insiders who acquired AU$369.5k worth of Adelong Gold Limited's (ASX:ADG) stock at an average price of AU$0.0045 in the past 12 months may be dismayed by the recent 20% price decline. Insiders buy with the expectation to see their investments rise in value over a period of time. However, recent losses have rendered their above investment worth AU$326.7k which is not ideal.

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.

View our latest analysis for Adelong Gold

Adelong Gold Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider purchase was by insider Peter Proksa for AU$160k worth of shares, at about AU$0.006 per share. That means that an insider was happy to buy shares at above the current price of AU$0.004. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. To us, it's very important to consider the price insiders pay for shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.

Adelong Gold insiders may have bought shares in the last year, but they didn't sell any. Their average price was about AU$0.0045. This is nice to see since it implies that insiders might see value around current prices. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

Adelong Gold 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 Adelong Gold

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Insiders own 36% of Adelong Gold shares, worth about AU$1.6m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Do The Adelong Gold Insider Transactions Indicate?

It doesn't really mean much that no insider has traded Adelong Gold shares in the last quarter. But insiders have shown more of an appetite for the stock, over the last year. Insiders do have a stake in Adelong Gold and their transactions don't cause us concern. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Adelong Gold. For example - Adelong Gold has 6 warning signs we think you should be aware of.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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 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.