Insiders Enjoy CA$9.0m Return After Buying Highlander Silver Stock

Insiders who purchased Highlander Silver Corp. (CSE:HSLV) shares in the past 12 months are unlikely to be deeply impacted by the stock's 10% decline over the past week. After accounting for the recent loss, the CA$4.60m worth of shares they purchased is now worth CA$13.6m, suggesting a good return on their investment.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

View our latest analysis for Highlander Silver

Highlander Silver Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider purchase was by insider Richard Warke for CA$3.0m worth of shares, at about CA$0.45 per share. Even though the purchase was made at a significantly lower price than the recent price (CA$0.61), 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.

While Highlander Silver insiders bought shares during the last year, they didn't sell. They paid about CA$0.21 on average. We don't deny that it is nice to see insiders buying stock in the company. However, you should keep in mind that they bought when the share price was meaningfully below today's levels. 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!

Highlander Silver is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.

Insider Ownership

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. Highlander Silver insiders own about CA$24m worth of shares (which is 64% of the company). Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

What Might The Insider Transactions At Highlander Silver Tell Us?

The fact that there have been no Highlander Silver insider transactions recently certainly doesn't bother us. But insiders have shown more of an appetite for the stock, over the last year. It would be great to see more insider buying, but overall it seems like Highlander Silver insiders are reasonably well aligned (owning significant chunk of the company's shares) and optimistic for the future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Highlander Silver. Case in point: We've spotted 5 warning signs for Highlander Silver you should be aware of, and 3 of these make us uncomfortable.

Of course Highlander Silver may not be the best stock to buy. So you may wish to see this free collection of high quality 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.