Stock Analysis

Insiders of Lundin Mining Corporation (TSE:LUN) received good value on their investment after their US$3.3m purchase jumped US$116k in value

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Lundin Mining Corporation (TSE:LUN) insiders who purchased shares in the last 12 months were richly rewarded last week. The stock climbed by 4.6% resulting in a CA$285m addition to the company’s market value. As a result, the stock they originally bought for US$3.3m is now worth US$3.4m.

While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.

Check out our latest analysis for Lundin Mining

The Last 12 Months Of Insider Transactions At Lundin Mining

Over the last year, we can see that the biggest insider purchase was by Lead Independent Director Charles Ashley Heppenstall for CA$1.0m worth of shares, at about CA$10.09 per share. That means that an insider was happy to buy shares at above the current price of CA$8.35. Their view may have changed since then, but at least it shows they felt optimistic at the time. To us, it's very important to consider the price insiders pay for shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels. We note that Charles Ashley Heppenstall was both the biggest buyer and the biggest seller.

Happily, we note that in the last year insiders paid CA$3.3m for 406.92k shares. But they sold 102.83k shares for CA$1.0m. Overall, Lundin Mining insiders were net buyers during the last year. They paid about CA$8.07 on average. It's great to see insiders putting their own cash into the company's stock, albeit at below the recent share price. 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!

TSX:LUN Insider Trading Volume March 29th 2023

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.

Insider Ownership Of Lundin Mining

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Lundin Mining insiders own about CA$21m worth of shares. That equates to 0.3% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Do The Lundin Mining Insider Transactions Indicate?

The fact that there have been no Lundin Mining insider transactions recently certainly doesn't bother us. But insiders have shown more of an appetite for the stock, over the last year. Insiders do have a stake in Lundin Mining and their transactions don't cause us concern. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Lundin Mining. For instance, we've identified 4 warning signs for Lundin Mining (1 is significant) you should be aware of.

Of course Lundin Mining 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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