Insiders of Geopacific Resources Getting Good Value On Their AU$1.90m Investment

Geopacific Resources Limited (ASX:GPR) insiders who purchased shares in the last 12 months were richly rewarded last week. The stock climbed by 13% resulting in a AU$2.7m addition to the company’s market value. Put another way, the original AU$1.90m acquisition is now worth AU$2.35m.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

See our latest analysis for Geopacific Resources

Geopacific Resources Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when insider Jingtao Chi bought AU$1.9m worth of shares at a price of AU$0.021 per share. We do like to see buying, but this purchase was made at well below the current price of AU$0.026. 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. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).

Does Geopacific Resources Boast High Insider Ownership?

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with 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. From our data, it seems that Geopacific Resources insiders own 15% of the company, worth about AU$3.5m. But they may have an indirect interest through a corporate structure that we haven't picked up on. We do generally prefer see higher levels of insider ownership.

So What Does This Data Suggest About Geopacific Resources Insiders?

It doesn't really mean much that no insider has traded Geopacific Resources shares in the last quarter. However, our analysis of transactions over the last year is heartening. The transactions are fine but it'd be more encouraging if Geopacific Resources insiders bought more shares in 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. For instance, we've identified 4 warning signs for Geopacific Resources (2 are a bit concerning) you should be aware of.

But note: Geopacific Resources may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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.

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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.