Insiders Give Up AU$72k As Pantera Minerals Stock Drops To AU$0.038

The recent 28% drop in Pantera Minerals Limited's (ASX:PFE) stock could come as a blow to insiders who purchased AU$300.0k worth of stock at an average buy price of AU$0.05 over the past 12 months. Insiders invest with the hopes of seeing their money grow in value over time. However, as a result of recent losses, their initial investment is now only worth AU$228.0k, which is not what they expected.

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.

View our latest analysis for Pantera Minerals

The Last 12 Months Of Insider Transactions At Pantera Minerals

In the last twelve months, the biggest single purchase by an insider was when Non Executive Chairman Barnaby Egerton-Warburton bought AU$300k worth of shares at a price of AU$0.05 per share. That means that an insider was happy to buy shares at above the current price of AU$0.038. Their view may have changed since then, but at least it shows they felt optimistic at the time. To us, it's very important to consider the price insiders pay for shares. Generally speaking, it catches our eye when an insider has purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price. Barnaby Egerton-Warburton was the only individual insider to buy during the last year.

The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.

Does Pantera Minerals Boast High 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. We usually like to see fairly high levels of insider ownership. Insiders own 10% of Pantera Minerals shares, worth about AU$1.4m, according to our data. However, it's possible that insiders might have an indirect interest through a more complex structure. Whilst better than nothing, we're not overly impressed by these holdings.

So What Do The Pantera Minerals Insider Transactions Indicate?

The recent insider purchase is heartening. And the longer term insider transactions also give us confidence. But we don't feel the same about the fact the company is making losses. We would certainly prefer see higher levels of insider ownership but analysis of the insider transactions suggests that Pantera Minerals insiders are expecting a bright future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Pantera Minerals. Every company has risks, and we've spotted 4 warning signs for Pantera Minerals (of which 3 can't be ignored!) you should know about.

But note: Pantera 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.