Bullish Chalice Mining Insider Buying Worth AU$34.6m Yet To Pay Off

The recent price decline of 15% in Chalice Mining Limited's (ASX:CHN) stock may have disappointed insiders who bought AU$34.6m worth of shares at an average price of AU$3.12 in the past 12 months. Insiders purchase with the hope of seeing their investments increase in value over time. However, due to recent losses, their initial investment is now only worth AU$11.0m, which is not great.

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.

Check out our latest analysis for Chalice Mining

Chalice Mining Insider Transactions Over The Last Year

The insider Timothy Rupert Goyder made the biggest insider purchase in the last 12 months. That single transaction was for AU$32m worth of shares at a price of AU$3.14 each. That means that even when the share price was higher than AU$0.99 (the recent price), an insider wanted to purchase shares. It's very possible they regret the purchase, but it's more likely they are bullish about the company. We always take careful note of the price insiders pay when purchasing shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels. Notably Timothy Rupert Goyder was also the biggest seller.

In the last twelve months insiders purchased 11.11m shares for AU$35m. On the other hand they divested 1.00m shares, for AU$2.9m. In total, Chalice Mining insiders bought more than they sold over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

Chalice Mining is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.

Does Chalice Mining Boast High Insider Ownership?

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. Chalice Mining insiders own about AU$53m worth of shares. That equates to 14% of the company. 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 Chalice Mining Insiders?

The fact that there have been no Chalice Mining insider transactions recently certainly doesn't bother us. But insiders have shown more of an appetite for the stock, over the last year. Insiders do have a stake in Chalice Mining and their transactions don't cause us concern. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Chalice Mining. Case in point: We've spotted 2 warning signs for Chalice Mining you should be aware of, and 1 of them is a bit concerning.

Of course Chalice Mining may not be the best stock to buy. So you may wish to see this free collection of high quality companies.

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.