Bullish Viridis Mining and Minerals Insiders Rewarded As Their Investment Rises To AU$3.57m

Viridis Mining and Minerals Limited (ASX:VMM) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 12%, resulting in a AU$6.9m rise in the company's market capitalisation, translating to a gain of 134% on their initial investment. As a result, their original purchase of AU$1.52m worth of stock is now worth AU$3.57m.

Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.

Check out our latest analysis for Viridis Mining and Minerals

Viridis Mining and Minerals Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider purchase was by insider Sufian Ahmad for AU$1.2m worth of shares, at about AU$0.95 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of AU$1.23. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.

While Viridis Mining and Minerals insiders bought shares during the last year, they didn't sell. Their average price was about AU$0.52. To my mind it is good that insiders have invested their own money in the company. However, you should keep in mind that they bought when the share price was meaningfully below today's levels. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

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 Viridis Mining and Minerals Boast High Insider Ownership?

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Viridis Mining and Minerals insiders own about AU$25m worth of shares. That equates to 39% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Do The Viridis Mining and Minerals Insider Transactions Indicate?

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. Overall we don't see anything to make us think Viridis Mining and Minerals insiders are doubting the company, and they do own shares. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Viridis Mining and Minerals. Every company has risks, and we've spotted 5 warning signs for Viridis Mining and Minerals (of which 3 are a bit unpleasant!) 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.