Bullish Carawine Resources Insiders Rewarded As Their Investment Rises To AU$5.39m

Carawine Resources Limited (ASX:CWX) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 30%, resulting in a AU$6.8m rise in the company's market capitalisation, translating to a gain of 11% on their initial investment. As a result, their original purchase of AU$4.85m worth of stock is now worth AU$5.39m.

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.

Check out our latest analysis for Carawine Resources

Carawine Resources Insider Transactions Over The Last Year

The insider Christopher Wallin made the biggest insider purchase in the last 12 months. That single transaction was for AU$4.3m worth of shares at a price of AU$0.11 each. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of AU$0.13. 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.

Christopher Wallin bought a total of 43.11m shares over the year at an average price of AU$0.11. 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!

Carawine Resources 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.

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Carawine Resources insiders own 91% of the company, currently worth about AU$27m based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Does This Data Suggest About Carawine Resources Insiders?

It doesn't really mean much that no insider has traded Carawine Resources shares in the last quarter. On a brighter note, the transactions over the last year are encouraging. Judging from their transactions, and high insider ownership, Carawine Resources insiders feel good about the company's future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Carawine Resources. Case in point: We've spotted 5 warning signs for Carawine Resources you should be aware of, and 2 of them are potentially serious.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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.