Even if it's not a huge purchase, we think it was good to see that Paul Cholakos, the Independent Non-Executive Director of Carpentaria Resources Limited (ASX:CAP) recently shelled out AU$63k to buy stock, at AU$0.10 per share. While we're hesitant to get too excited about a purchase of that size, we do note it increased their holding by a solid 42%.
The Last 12 Months Of Insider Transactions At Carpentaria Resources
In fact, the recent purchase by Paul Cholakos was the biggest purchase of Carpentaria Resources shares made by an insider individual in the last twelve months, according to our records. We do like to see buying, but this purchase was made at well below the current price of AU$0.15. 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.
Paul Cholakos bought 2.04m shares over the last 12 months at an average price of AU$0.057. 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!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
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. Our data indicates that Carpentaria Resources insiders own about AU$4.9m worth of shares (which is 8.1% of the company). We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!
What Might The Insider Transactions At Carpentaria Resources Tell Us?
It is good to see the recent insider purchase. And the longer term insider transactions also give us confidence. But we don't feel the same about the fact the company is making losses. On this analysis the only slight negative we see is the fairly low (overall) insider ownership; their transactions suggest that they are quite positive on Carpentaria Resources stock. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Carpentaria Resources. For instance, we've identified 5 warning signs for Carpentaria Resources (1 can't be ignored) you should be aware of.
But note: Carpentaria Resources 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, but not derivative transactions.
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