Despite Recent Gains, Hamelin Gold Insiders Are Still Down AU$40k

Insiders who bought AU$200.0k worth of Hamelin Gold Limited (ASX:HMG) stock in the last year recovered part of their losses as the stock rose by 11% last week. However, the purchase is proving to be a costly gamble, since losses made by insiders have totalled AU$40k since the time of purchase.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

See our latest analysis for Hamelin Gold

Hamelin Gold Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when MD & Executive Director Peter Bewick bought AU$90k worth of shares at a price of AU$0.10 per share. That means that an insider was happy to buy shares at above the current price of AU$0.08. 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. To us, it's very important to consider the price insiders pay for shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.

While Hamelin Gold insiders bought shares during the last year, they didn't sell. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

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

For a common shareholder, it is worth checking how many shares are held by company 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. Our data indicates that Hamelin Gold insiders own about AU$1.8m worth of shares (which is 14% of the company). Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!

So What Does This Data Suggest About Hamelin Gold Insiders?

There haven't been any insider transactions in the last three months -- that doesn't mean much. On a brighter note, the transactions over the last year are encouraging. While we have no worries about the insider transactions, we'd be more comfortable if they owned more Hamelin Gold stock. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Hamelin Gold. Our analysis shows 4 warning signs for Hamelin Gold (3 shouldn't be ignored!) and we strongly recommend you look at these before investing.

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.