Highfield Resources Limited's stock is down 11%, but insiders still have about AU$37k in profit after buying earlier this year

By
Simply Wall St
Published
January 25, 2022
ASX:HFR
Source: Shutterstock

Insiders who purchased Highfield Resources Limited (ASX:HFR) shares in the past 12 months are unlikely to be deeply impacted by the stock's 11% decline over the past week. Reason being, despite the recent loss, insiders original purchase value of AU$60k is now worth AU$96k.

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

View our latest analysis for Highfield Resources

Highfield Resources Insider Transactions Over The Last Year

While no particular insider transaction stood out, we can still look at the overall trading.

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:HFR Insider Trading Volume January 25th 2022

There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).

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. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 8.9% of Highfield Resources shares, worth about AU$25m. 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 Highfield Resources Insider Transactions Indicate?

There haven't been any insider transactions in the last three months -- that doesn't mean much. However, our analysis of transactions over the last year is heartening. Insiders do have a stake in Highfield Resources and their transactions don't cause us concern. 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 6 warning signs for Highfield Resources (3 are concerning!) and we strongly recommend you look at them before investing.

But note: Highfield 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, but not derivative transactions.

Discounted cash flow calculation for every stock

Simply Wall St does a detailed discounted cash flow calculation every 6 hours for every stock on the market, so if you want to find the intrinsic value of any company just search here. It’s FREE.

Make Confident Investment Decisions

Simply Wall St's Editorial Team provides unbiased, factual reporting on global stocks using in-depth fundamental analysis.
Find out more about our editorial guidelines and team.