Insiders Could Have Profited By Holding onto AuKing Mining Shares Despite 25% Drop

AuKing Mining Limited's (ASX:AKN) value has fallen 25% in the last week, but insiders who sold AU$900k worth of stock over the last year have had less success. Given that the average selling price of AU$0.10 is still lower than the current share price, insiders would probably have been better off keeping their shares.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

View our latest analysis for AuKing Mining

AuKing Mining Insider Transactions Over The Last Year

The insider, Zuliang Wei, made the biggest insider sale in the last 12 months. That single transaction was for AU$900k worth of shares at a price of AU$0.10 each. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. The good news is that this large sale was at well above current price of AU$0.006. So it may not shed much light on insider confidence at current levels. Zuliang Wei was the only individual insider to sell shares in the last twelve months.

In the last twelve months insiders purchased 7.60m shares for AU$135k. On the other hand they divested 9.00m shares, for AU$900k. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

I will like AuKing Mining better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

AuKing Mining Insiders Bought Stock Recently

There was some insider buying at AuKing Mining over the last quarter. Independent Non-Executive Chairman Peter Tighe shelled out AU$50k for shares in that time. We like it when there are only buyers, and no sellers. However, in this case the amount invested recently is quite small.

Does AuKing Mining 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. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 16% of AuKing Mining shares, worth about AU$302k. 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 Does This Data Suggest About AuKing Mining Insiders?

We note a that there has been a bit of insider buying recently (but no selling). The net investment is not enough to encourage us much. Still, the insider transactions at AuKing Mining in the last 12 months are not very heartening. But we do like the fact that insiders own a fair chunk of the company. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. In terms of investment risks, we've identified 5 warning signs with AuKing Mining and understanding these should be part of your investment process.

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.