Rottenstone Gold Decline Means Insider Profits Down To CA$298k

Insiders who purchased Rottenstone Gold Inc. (CSE:SK) shares in the past 12 months are unlikely to be deeply impacted by the stock's 30% decline over the past week. Even after accounting for the recent loss, the CA$312.5k worth of stock purchased by them is now worth CA$610.6k or in other words, their investment continues to give good returns.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

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Rottenstone Gold Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider purchase was by Chairman & CEO Ryan Kalt for CA$88k worth of shares, at about CA$0.05 per share. We do like to see buying, but this purchase was made at well below the current price of CA$0.16. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

Ryan Kalt purchased 3.82m shares over the year. The average price per share was CA$0.082. 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!

Check out our latest analysis for Rottenstone Gold

Rottenstone Gold 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 Of Rottenstone Gold

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. Rottenstone Gold insiders own about CA$6.0m worth of shares (which is 84% of the company). 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 Rottenstone Gold Insiders?

It's certainly positive to see the recent insider purchase. 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 Rottenstone Gold. Nice! 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. You'd be interested to know, that we found 4 warning signs for Rottenstone Gold and we suggest you have a look.

But note: Rottenstone Gold may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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.