One Dome Gold Mines Insider Has Reduced Their Stake

From what we can see, insiders were net sellers in Dome Gold Mines Ltd's (ASX:DME ) during the past 12 months. That is, insiders sold the stock in greater numbers than they purchased it.

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.

We've discovered 5 warning signs about Dome Gold Mines. View them for free.

The Last 12 Months Of Insider Transactions At Dome Gold Mines

Over the last year, we can see that the biggest insider sale was by the Non-Executive Director, Tadao Tsubata, for AU$152k worth of shares, at about AU$0.19 per share. That means that even when the share price was below the current price of AU$0.20, an insider wanted to cash in some shares. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. We note that the biggest single sale was only 1.8% of Tadao Tsubata's holding. Tadao Tsubata was the only individual insider to sell over the last year. Notably Tadao Tsubata was also the biggest buyer, having purchased AU$93k worth of shares.

Tadao Tsubata divested 1.57m shares over the last 12 months at an average price of AU$0.19. 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!

Check out our latest analysis for Dome Gold Mines

I will like Dome Gold Mines better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Does Dome Gold Mines 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. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Insiders own 30% of Dome Gold Mines shares, worth about AU$24m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

What Might The Insider Transactions At Dome Gold Mines Tell Us?

There haven't been any insider transactions in the last three months -- that doesn't mean much. Our analysis of Dome Gold Mines insider transactions leaves us cautious. But we do like the fact that insiders own a fair chunk of the company. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. At Simply Wall St, we've found that Dome Gold Mines has 5 warning signs (4 are potentially serious!) that deserve your attention before going any further with your analysis.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.