Insider Spends AU$116k Buying More Shares In Global Lithium Resources

Even if it's not a huge purchase, we think it was good to see that Dianmin Chen, the CEO, Managing Director & Executive Director of Global Lithium Resources Limited (ASX:GL1) recently shelled out AU$116k to buy stock, at AU$0.14 per share. However, it only increased their shares held by 6.1%, and it wasn't a huge purchase by absolute value, either.

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The Last 12 Months Of Insider Transactions At Global Lithium Resources

Notably, that recent purchase by Dianmin Chen is the biggest insider purchase of Global Lithium Resources shares that we've seen in the last year. So it's clear an insider wanted to buy, at around the current price, which is AU$0.15. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. We do always like to see insider buying, but it is worth noting if those purchases were made at well below today's share price, as the discount to value may have narrowed with the rising price. The good news for Global Lithium Resources share holders is that an insider was buying at near the current price. The only individual insider to buy over the last year was Dianmin Chen.

Dianmin Chen purchased 1.14m shares over the year. The average price per share was AU$0.16. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

See our latest analysis for Global Lithium Resources

Global Lithium 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 Of Global Lithium Resources

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. Global Lithium Resources insiders own about AU$6.7m worth of shares. That equates to 17% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Do The Global Lithium Resources Insider Transactions Indicate?

It's certainly positive to see the recent insider purchase. 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. Insiders likely see value in Global Lithium Resources shares, given these transactions (along with notable insider ownership of 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. Be aware that Global Lithium Resources is showing 4 warning signs in our investment analysis, and 2 of those can't be ignored...

Of course Global Lithium Resources 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 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.