As Galileo Mining Ltd (ASX:GAL) gains 170%, insiders who bought last year may be wishing they had bet higher

By
Simply Wall St
Published
May 13, 2022
ASX:GAL
Source: Shutterstock

Last week, Galileo Mining Ltd (ASX:GAL) insiders, who had purchased shares in the previous 12 months were rewarded handsomely. The shares increased by 170% last week, resulting in a AU$57m increase in the company's market worth. In other words, the original AU$94k purchase is now worth AU$189k.

While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.

Check out our latest analysis for Galileo Mining

The Last 12 Months Of Insider Transactions At Galileo Mining

Over the last year, we can see that the biggest insider purchase was by Independent Non-Executive Director Noel O'Brien for AU$94k worth of shares, at about AU$0.27 per share. We do like to see buying, but this purchase was made at well below the current price of AU$0.54. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

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!

insider-trading-volume
ASX:GAL Insider Trading Volume May 13th 2022

Galileo Mining 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

Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. From looking at our data, insiders own AU$2.7m worth of Galileo Mining stock, about 2.9% of the company. However, it's possible that insiders might have an indirect interest through a more complex structure. We consider this fairly low insider ownership.

So What Does This Data Suggest About Galileo Mining Insiders?

The fact that there have been no Galileo Mining insider transactions recently certainly doesn't bother us. But insiders have shown more of an appetite for the stock, over the last year. We'd like to see bigger individual holdings. However, we don't see anything to make us think Galileo Mining insiders are doubting the company. 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. Our analysis shows 5 warning signs for Galileo Mining (2 make us uncomfortable!) and we strongly recommend you look at them before investing.

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, but not derivative transactions.

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