Resource Base Decline Means Insider Profits Down To AU$70k

Insiders who purchased Resource Base Limited (ASX:RBX) shares in the past 12 months are unlikely to be deeply impacted by the stock's 15% decline over the past week. After taking the recent loss into consideration, the AU$150.0k worth of stock they bought is now worth AU$220.0k, indicating that their investment yielded a positive return.

While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.

Check out our latest analysis for Resource Base

The Last 12 Months Of Insider Transactions At Resource Base

In the last twelve months, the biggest single purchase by an insider was when Non-Executive Chairman Maurice Feilich bought AU$100k worth of shares at a price of AU$0.075 per share. Even though the purchase was made at a significantly lower price than the recent price (AU$0.11), we still think insider buying is a positive. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.

While Resource Base insiders bought shares during the last year, they didn't sell. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

Resource Base is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

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. Our data indicates that Resource Base insiders own about AU$1.2m worth of shares (which is 14% 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 Does This Data Suggest About Resource Base Insiders?

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. While we have no worries about the insider transactions, we'd be more comfortable if they owned more Resource Base stock. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Resource Base. Every company has risks, and we've spotted 6 warning signs for Resource Base (of which 4 shouldn't be ignored!) you should know about.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.