Insider Spends AU$114k Buying More Shares In Forrestania Resources

Whilst it may not be a huge deal, we thought it was good to see that the Forrestania Resources Limited (ASX:FRS) Non Executive Director, Daniel Raihani, recently bought AU$114k worth of stock, for AU$0.014 per share. That purchase might not be huge but it did increase their holding by 36%.

Our free stock report includes 5 warning signs investors should be aware of before investing in Forrestania Resources. Read for free now.

Forrestania Resources Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when insider Adam Turnbull bought AU$367k worth of shares at a price of AU$0.026 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of AU$0.047. 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.

While Forrestania Resources insiders bought shares during the last year, they didn't sell. Their average price was about AU$0.022. It is certainly positive to see that insiders have invested their own money in the company. However, we do note that they were buying at significantly lower prices than today's share price. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

Check out our latest analysis for Forrestania Resources

Forrestania Resources is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.

Insider Ownership

Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 37% of Forrestania Resources shares, worth about AU$4.6m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Do The Forrestania Resources Insider Transactions Indicate?

The recent insider purchases are heartening. And an analysis of the transactions over the last year also gives us confidence. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. Insiders likely see value in Forrestania Resources shares, given these transactions (along with notable insider ownership of the company). So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. At Simply Wall St, we found 5 warning signs for Forrestania Resources that deserve your attention before buying any shares.

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.