Insiders At NGEx Minerals Sold CA$5.7m In Stock, Alluding To Potential Weakness

Over the past year, many NGEx Minerals Ltd. (TSE:NGEX) insiders sold a significant stake in the company which may have piqued investors' interest. When analyzing insider transactions, it is usually more valuable to know whether insiders are buying versus knowing if they are selling, as the latter sends an ambiguous message. However, if numerous insiders are selling, shareholders should investigate more.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

See our latest analysis for NGEx Minerals

The Last 12 Months Of Insider Transactions At NGEx Minerals

Over the last year, we can see that the biggest insider purchase was by insider Axel Lundin for CA$1.9m worth of shares, at about CA$9.81 per share. That means that an insider was happy to buy shares at around the current price of CA$10.70. Of course they may have changed their mind. But this suggests they are optimistic. We do always like to see insider buying, but it is worth noting if those purchases were made at well below today's share price, as the discount to value may have narrowed with the rising price. Happily, the NGEx Minerals insiders decided to buy shares at close to current prices.

In the last twelve months insiders purchased 270.70k shares for CA$2.5m. But insiders sold 665.85k shares worth CA$5.7m. All up, insiders sold more shares in NGEx Minerals than they bought, over the last year. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: Most of them are flying under the radar).

NGEx Minerals Insiders Bought Stock Recently

It's good to see that NGEx Minerals insiders have made notable investments in the company's shares. We can see that Vice President of Corporate Development & IR Brent Bonney paid CA$80k for shares in the company. No-one sold. This makes one think the business has some good points.

Does NGEx Minerals Boast High Insider Ownership?

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. Insiders own 3.0% of NGEx Minerals shares, worth about CA$59m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Do The NGEx Minerals Insider Transactions Indicate?

The recent insider purchase is heartening. However, the longer term transactions are not so encouraging. The more recent transactions are a positive, but NGEx Minerals insiders haven't shown the sustained enthusiasm that we look for, although they do own a decent number of shares, overall. In short they are likely aligned with shareholders. 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 that end, you should learn about the 4 warning signs we've spotted with NGEx Minerals (including 2 which are significant).

Of course NGEx Minerals 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.