Ora Banda Mining Insider Lowered Holding By 76% During Last Year

From what we can see, insiders were net sellers in Ora Banda Mining Limited's (ASX:OBM ) during the past 12 months. That is, insiders sold the stock in greater numbers than they purchased it.

While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.

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The Last 12 Months Of Insider Transactions At Ora Banda Mining

Notably, that recent sale by Peter Mansell is the biggest insider sale of Ora Banda Mining shares that we've seen in the last year. So it's clear an insider wanted to take some cash off the table, even slightly below the current price of AU$1.26. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. We note that the biggest single sale was 76% of Peter Mansell's holding.

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!

View our latest analysis for Ora Banda Mining

I will like Ora Banda Mining better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Ora Banda Mining Insiders Are Selling The Stock

The last quarter saw substantial insider selling of Ora Banda Mining shares. In total, Independent Non-Executive Chairman Peter Mansell dumped AU$10m worth of shares in that time, and we didn't record any purchases whatsoever. In light of this it's hard to argue that all the insiders think that the shares are a bargain.

Insider Ownership

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It's great to see that Ora Banda Mining insiders own 9.1% of the company, worth about AU$218m. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

What Might The Insider Transactions At Ora Banda Mining Tell Us?

An insider hasn't bought Ora Banda Mining stock in the last three months, but there was some selling. Looking to the last twelve months, our data doesn't show any insider buying. But since Ora Banda Mining is profitable and growing, we're not too worried by this. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about 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. Every company has risks, and we've spotted 2 warning signs for Ora Banda Mining (of which 1 is potentially serious!) you should know about.

Of course Ora Banda Mining 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.