Insiders of Black Rock Mining Limited (ASX:BKT) reaped rewards after their AU$871k investment jumped another AU$1.7m

Black Rock Mining Limited (ASX:BKT) insiders who purchased shares in the last 12 months were richly rewarded last week. The stock climbed by 14% resulting in a AU$17m addition to the company’s market value. As a result, the stock they originally bought for AU$871k is now worth AU$2.6m.

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.

View our latest analysis for Black Rock Mining

Black Rock Mining Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider purchase was by insider Stephen Copulos for AU$819k worth of shares, at about AU$0.064 per share. We do like to see buying, but this purchase was made at well below the current price of AU$0.17. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.

Happily, we note that in the last year insiders paid AU$871k for 15.72m shares. But they sold 5.72m shares for AU$710k. Overall, Black Rock Mining insiders were net buyers during the last year. Their average price was about AU$0.055. To my mind it is good that insiders have invested their own money in the company. But we must note that the investments were made at well below today's share price. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

Black Rock Mining is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Black Rock Mining Insiders Are Selling The Stock

The last quarter saw substantial insider selling of Black Rock Mining shares. Specifically, insider Stephen Copulos ditched AU$710k worth of shares in that time, and we didn't record any purchases whatsoever. In light of this it's hard to argue that all the insiders think that the shares are a bargain.

Insider Ownership of Black Rock Mining

For a common shareholder, it is worth checking how many shares are held by company 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. Black Rock Mining insiders own about AU$26m worth of shares. That equates to 19% of the company. 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 Black Rock Mining Insiders?

An insider sold stock recently, but they haven't been buying. But we take heart from prior transactions. We like that insiders own a fair amount of the company. So we're not overly bothered by recent selling. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Black Rock Mining. When we did our research, we found 4 warning signs for Black Rock Mining (2 shouldn't be ignored!) that we believe deserve your full attention.

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, but not derivative transactions.

If you decide to trade Black Rock Mining, use the lowest-cost* platform that is rated #1 Overall by Barron’s, Interactive Brokers. Trade stocks, options, futures, forex, bonds and funds on 135 markets, all from a single integrated account. Promoted

This article by Simply Wall St is general in nature. 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.
^*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020

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