Cavalier Resources Loses AU$2.3m Market Value But Insiders See Windfall Of AU$199k

Insiders who purchased Cavalier Resources Ltd (ASX:CVR) shares in the past 12 months are unlikely to be deeply impacted by the stock's 14% decline over the past week. Even after accounting for the recent loss, the AU$82.5k worth of stock purchased by them is now worth AU$281.5k or in other words, their investment continues to give good returns.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

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Cavalier Resources Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when insider Kerry Parsons bought AU$83k worth of shares at a price of AU$0.076 per share. We do like to see buying, but this purchase was made at well below the current price of AU$0.24. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.

You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

View our latest analysis for Cavalier Resources

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.

Cavalier Resources Insiders Are Selling The Stock

The last three months saw some Cavalier Resources insider selling. insider Ross Johns sold just AU$31k worth of shares in that time. Neither the lack of buying nor the presence of selling is heartening. But the selling simply isn't sufficiently substantial to be of much use as a signal.

Does Cavalier Resources Boast High Insider Ownership?

Many investors like to check how much of a company is owned by 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. Cavalier Resources insiders own about AU$3.9m worth of shares. That equates to 28% 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 Cavalier Resources Insiders?

While there has not been any insider buying in the last three months, there has been selling. However, the sales are not big enough to concern us at all. However, our analysis of transactions over the last year is heartening. Overall we don't see anything to make us think Cavalier Resources insiders are doubting the company, and they do own shares. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Cavalier Resources. To assist with this, we've discovered 6 warning signs that you should run your eye over to get a better picture of Cavalier Resources.

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.