Duke Exploration Limited (ASX:DEX) insiders recover some losses but still AU$206k away from matching original investment

By
Simply Wall St
Published
November 11, 2021
ASX:DEX
Source: Shutterstock

Some of the losses seen by insiders who purchased AU$606k worth of Duke Exploration Limited (ASX:DEX) shares over the past year were recovered after the stock increased by 14% over the past week. The purchase, however, has proven to be a pricey bet, with losses currently totalling AU$206k.

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 Duke Exploration

The Last 12 Months Of Insider Transactions At Duke Exploration

Over the last year, we can see that the biggest insider purchase was by insider Keiran Slee for AU$283k worth of shares, at about AU$0.33 per share. That means that an insider was happy to buy shares at above the current price of AU$0.20. 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.

Duke Exploration insiders may have bought shares in the last year, but they didn't sell any. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

insider-trading-volume
ASX:DEX Insider Trading Volume November 11th 2021

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.

Duke Exploration Insiders Bought Stock Recently

Over the last three months, we've seen a bit of insider buying at Duke Exploration. Insiders purchased AU$51k worth of shares in that period. It's great to see that insiders are only buying, not selling. But the amount invested in the last three months isn't enough for us too put much weight on it, as a single factor.

Insider Ownership of Duke Exploration

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with 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. Duke Exploration insiders own about AU$8.7m worth of shares (which is 40% of the company). 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 Duke Exploration Insiders?

It's certainly positive to see the recent insider purchases. And an analysis of the transactions over the last year also gives us confidence. But on the other hand, the company made a loss during the last year, which makes us a little cautious. Once you factor in the high insider ownership, it certainly seems like insiders are positive about Duke Exploration. Looks promising! So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Be aware that Duke Exploration is showing 5 warning signs in our investment analysis, and 2 of those are a bit concerning...

Of course Duke Exploration 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, but not derivative transactions.

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