Lodestar Minerals' Stock Sinks To AU$0.001, But Insiders Sold Even Lower

Lodestar Minerals Limited's (ASX:LSR) stock price has dropped 33% in the previous week, but insiders who sold AU$254k in stock over the past year have had less luck. Given that the average selling price of AU$0.004 is still lower than the current share price, insiders would probably have been better off keeping their shares.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

Check out our latest analysis for Lodestar Minerals

The Last 12 Months Of Insider Transactions At Lodestar Minerals

Over the last year, we can see that the biggest insider sale was by the Non-Executive Chairman, Ross Taylor, for AU$175k worth of shares, at about AU$0.0045 per share. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The silver lining is that this sell-down took place above the latest price (AU$0.001). So it may not tell us anything about how insiders feel about the current share price. Ross Taylor was the only individual insider to sell over the last year.

Ross Taylor ditched 63.00m shares over the year. The average price per share was AU$0.004. 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!

If you are like me, then you will not want to miss this free list of small cap stocks that are not only being bought by insiders but also have attractive valuations.

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. Our data indicates that Lodestar Minerals insiders own about AU$247k worth of shares (which is 9.5% of the company). But they may have an indirect interest through a corporate structure that we haven't picked up on. Whilst better than nothing, we're not overly impressed by these holdings.

So What Do The Lodestar Minerals Insider Transactions Indicate?

There haven't been any insider transactions in the last three months -- that doesn't mean much. Our analysis of Lodestar Minerals insider transactions leaves us unenthusiastic. We also note that, as far as we can see, insider ownership is fairly low, compared to other companies. 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. Case in point: We've spotted 5 warning signs for Lodestar Minerals you should be aware of, and 4 of them are concerning.

But note: Lodestar Minerals 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com