Insider Buyers At Aurumin Sitting On AU$378k Profit

Aurumin Limited (ASX:AUN) insiders who acquired shares over the previous 12 months, can probably afford to ignore the recent 11% decline in the stock price. After taking the recent loss into consideration, the AU$1.54m worth of stock they bought is now worth AU$1.92m, indicating that their investment yielded a positive return.

Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.

See our latest analysis for Aurumin

The Last 12 Months Of Insider Transactions At Aurumin

The Non-Executive Director Daniel Raihani made the biggest insider purchase in the last 12 months. That single transaction was for AU$463k worth of shares at a price of AU$0.026 each. We do like to see buying, but this purchase was made at well below the current price of AU$0.034. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

While Aurumin insiders bought shares during the last year, they didn't sell. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

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

Aurumin Insiders Bought Stock Recently

Over the last quarter, Aurumin insiders have spent a meaningful amount on shares. Not only was there no selling that we can see, but they collectively bought AU$346k worth of shares. That shows some optimism about the company's future.

Insider Ownership

Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. It appears that Aurumin insiders own 23% of the company, worth about AU$3.5m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Does This Data Suggest About Aurumin Insiders?

It is good to see recent purchasing. And the longer term insider transactions also give us confidence. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. When combined with notable insider ownership, these factors suggest Aurumin 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. For example, Aurumin has 5 warning signs (and 3 which shouldn't be ignored) we think you should know about.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com