Truscott Mining Insider Confidence Rewarded, Stock Hits AU$13m Market Cap

Truscott Mining Corporation Limited (ASX:TRM) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 17%, resulting in a AU$2.4m rise in the company's market capitalisation, translating to a gain of 18% on their initial investment. As a result, the stock they originally bought for AU$297.4k is now worth AU$351.0k.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.

See our latest analysis for Truscott Mining

The Last 12 Months Of Insider Transactions At Truscott Mining

Notably, that recent purchase by Peter Smith is the biggest insider purchase of Truscott Mining shares that we've seen in the last year. Even though the purchase was made at a significantly lower price than the recent price (AU$0.07), we still think insider buying is a positive. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

Peter Smith bought a total of 5.01m shares over the year at an average price of AU$0.059. 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!

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

Insider Ownership Of Truscott Mining

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. Truscott Mining insiders own 64% of the company, currently worth about AU$8.6m based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Does This Data Suggest About Truscott Mining Insiders?

The recent insider purchase is heartening. We also take confidence from the longer term picture of insider transactions. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. Once you factor in the high insider ownership, it certainly seems like insiders are positive about Truscott Mining. That's what I like to see! While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. To help with this, we've discovered 5 warning signs (4 are potentially serious!) that you ought to be aware of before buying any shares in Truscott Mining.

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.