Insiders Sold Advance Metals Prematurely At AU$0.051 With Stock Trading Higher

Despite the fact that Advance Metals Limited's (ASX:AVM) value has dropped 14% in the last week insiders who sold AU$241k worth of stock in the past 12 months have had less success. Given that the average selling price of AU$0.051 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, we do think it is perfectly logical to keep tabs on what insiders are doing.

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Advance Metals Insider Transactions Over The Last Year

The insider, David Pevcic, made the biggest insider sale in the last 12 months. That single transaction was for AU$241k worth of shares at a price of AU$0.051 each. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. The silver lining is that this sell-down took place above the latest price (AU$0.042). So it is hard to draw any strong conclusion from it. The only individual insider seller over the last year was David Pevcic.

In the last twelve months insiders purchased 2.34m shares for AU$67k. But insiders sold 4.72m shares worth AU$241k. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

View our latest analysis for Advance Metals

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: Most of them are flying under the radar).

Insider Ownership Of Advance Metals

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. 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 34% of Advance Metals shares, worth about AU$3.8m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

What Might The Insider Transactions At Advance Metals Tell Us?

It doesn't really mean much that no insider has traded Advance Metals shares in the last quarter. Our analysis of Advance Metals insider transactions leaves us cautious. But it's good to see that insiders own shares in the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Advance Metals. At Simply Wall St, we've found that Advance Metals has 4 warning signs (3 are a bit concerning!) that deserve your attention before going any further with your analysis.

But note: Advance Metals may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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.