Trade Alert: The Senior Executive Vice President of Strategic Matters Of Barrick Gold Corporation (TSE:ABX), Kevin Thomson, Has Just Spent US$1.9m Buying 83% More Shares

Those following along with Barrick Gold Corporation (TSE:ABX) will no doubt be intrigued by the recent purchase of shares by Kevin Thomson, Senior Executive Vice President of Strategic Matters of the company, who spent a stonking CA$1.9m on stock at an average price of CA$31.97. That increased their holding by a full 83%, which arguably implies the sort of confidence required for a shy sweet-natured nerd to ask the most popular kid in the school to go out on a date.

Check out our latest analysis for Barrick Gold

The Last 12 Months Of Insider Transactions At Barrick Gold

Over the last year, we can see that the biggest insider sale was by the Executive Chairman & Member of International Advisory Board, John Thornton, for CA$71m worth of shares, at about CA$27.73 per share. That means that an insider was selling shares at slightly below the current price (CA$29.80). As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. It is worth noting that this sale was 52% of John Thornton's holding.

In the last twelve months insiders purchased 531.84k shares for CA$15m. But they sold 3.49m shares for CA$102m. In total, Barrick Gold insiders sold more than they bought over the last year. The sellers received a price of around US$29.12, on average. It's not too encouraging to see that insiders have sold at below the current price. Since insiders sell for many reasons, we wouldn't put too much weight on it. 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!

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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. A high insider ownership often makes company leadership more mindful of shareholder interests. Barrick Gold insiders own about CA$278m worth of shares (which is 0.5% 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 Barrick Gold Tell Us?

The recent insider purchases are heartening. But we can't say the same for the transactions over the last 12 months. The high levels of insider ownership, and the recent buying by some insiders suggests they are well aligned and optimistic. While we like knowing 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. For instance, we've identified 3 warning signs for Barrick Gold (1 is significant) you should be aware of.

Of course Barrick Gold 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, but not derivative transactions.

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This article by Simply Wall St is general in nature. 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.
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