Insider Buyers Lose Additional AU$138k As Freehill Mining Dips To AU$8.5m

The recent price decline of 25% in Freehill Mining Limited's (ASX:FHS) stock may have disappointed insiders who bought AU$323.4k worth of shares at an average price of AU$0.0052 in the past 12 months. This is not good as insiders invest based on expectations that their money will appreciate over time. However, as a result of recent losses, their original investment is now worth only AU$185.1k.

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 Freehill Mining

The Last 12 Months Of Insider Transactions At Freehill Mining

The insider Gavin Ross made the biggest insider purchase in the last 12 months. That single transaction was for AU$300k worth of shares at a price of AU$0.021 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being AU$0.003). Their view may have changed since then, but at least it shows they felt optimistic at the time. To us, it's very important to consider the price insiders pay for shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.

Freehill Mining insiders may have bought shares in the last year, but they didn't sell any. They paid about AU$0.0052 on average. These transactions suggest that insiders have considered the current price attractive. 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!

Freehill Mining is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Insiders At Freehill Mining Have Bought Stock Recently

It's good to see that Freehill Mining insiders have made notable investments in the company's shares. Not only was there no selling that we can see, but they collectively bought AU$323k worth of shares. That shows some optimism about the company's future.

Insider Ownership Of Freehill Mining

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. Freehill Mining insiders own about AU$3.2m worth of shares. That equates to 38% 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 Do The Freehill Mining Insider Transactions Indicate?

The recent insider purchases are heartening. 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. Given that insiders also own a fair bit of Freehill Mining we think they are probably pretty confident of a bright future. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Every company has risks, and we've spotted 6 warning signs for Freehill Mining you should know about.

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.