Eldorado Gold Insiders Sold US$17m Of Shares Suggesting Hesitancy

Over the past year, many Eldorado Gold Corporation (TSE:ELD) insiders sold a significant stake in the company which may have piqued investors' interest. Knowing whether insiders are buying is usually more helpful when evaluating insider transactions, as insider selling can have various explanations. However, if numerous insiders are selling, shareholders should investigate more.

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.

View our latest analysis for Eldorado Gold

Eldorado Gold Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the President, George Burns, sold CA$4.6m worth of shares at a price of CA$20.60 per share. That means that an insider was selling shares at slightly below the current price (CA$25.71). 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. This single sale was just 30% of George Burns's stake.

Happily, we note that in the last year insiders paid CA$40k for 2.55k shares. On the other hand they divested 888.60k shares, for CA$17m. Over the last year we saw more insider selling of Eldorado Gold shares, than buying. 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!

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Eldorado Gold Insiders Are Selling The Stock

Over the last three months, we've seen notably more insider selling, than insider buying, at Eldorado Gold. We note insiders cashed in CA$529k worth of shares. On the other hand we note insider Karen Aram bought CA$30k worth of shares. Generally this level of net selling might be considered a bit bearish.

Insider Ownership

Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 0.5% of Eldorado Gold shares, worth about CA$24m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Does This Data Suggest About Eldorado Gold Insiders?

The insider sales have outweighed the insider buying, at Eldorado Gold, in the last three months. Despite some insider buying, the longer term picture doesn't make us feel much more positive. But it is good to see that Eldorado Gold is growing earnings. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. So we'd only buy after careful consideration. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. To assist with this, we've discovered 1 warning sign that you should run your eye over to get a better picture of Eldorado Gold.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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.