Warriedar Resources Slides As Insider Purchases Lose Another AU$67k

The recent price decline of 12% in Warriedar Resources Limited's (ASX:WA8) stock may have disappointed insiders who bought AU$360.0k worth of shares at an average price of AU$0.061 in 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$293.2k, which is not what they expected.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

See our latest analysis for Warriedar Resources

The Last 12 Months Of Insider Transactions At Warriedar Resources

In the last twelve months, the biggest single purchase by an insider was when insider Mingyan Wang bought AU$200k worth of shares at a price of AU$0.07 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being AU$0.05). It's very possible they regret the purchase, but it's more likely they are bullish about the company. To us, it's very important to consider the price insiders pay for shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.

While Warriedar Resources insiders bought shares during the last year, they didn't sell. The average buy price was around AU$0.061. These transactions suggest that insiders have considered the current price attractive. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

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 Warriedar Resources

Many investors like to check how much of a company is owned by 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. From our data, it seems that Warriedar Resources insiders own 7.9% of the company, worth about AU$3.0m. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. Whilst better than nothing, we're not overly impressed by these holdings.

What Might The Insider Transactions At Warriedar Resources Tell Us?

It doesn't really mean much that no insider has traded Warriedar Resources shares in the last quarter. 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 Warriedar Resources stock. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Warriedar Resources. When we did our research, we found 4 warning signs for Warriedar Resources (2 are a bit concerning!) that we believe deserve your full attention.

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.