Insiders In AsiaBaseMetals Left Out From 14% Price Rise After Disposing Stock

Despite the fact that AsiaBaseMetals Inc. (CVE:ABZ) stock rose 14% last week, insiders who sold CA$418k worth of stock in the previous 12 months are likely to be better off. Selling at an average price of CA$0.12, which is higher than the current price might have been the right call as holding on to stock would have meant their investment would be worth less now than it was at the time of sale.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

See our latest analysis for AsiaBaseMetals

AsiaBaseMetals Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the CFO & Director, Terrylene Penstock, for CA$260k worth of shares, at about CA$0.16 per share. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The silver lining is that this sell-down took place above the latest price (CA$0.08). So it may not tell us anything about how insiders feel about the current share price. Terrylene Penstock was the only individual insider to sell shares in the last twelve months.

Terrylene Penstock divested 3.50m shares over the last 12 months at an average price of CA$0.12. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

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Are AsiaBaseMetals Insiders Buying Or Selling?

There was some insider buying at AsiaBaseMetals over the last quarter. Founder Rajinder Chowdhry bought CA$12k worth of shares in that time. It's great to see that insiders are only buying, not selling. But the amount invested in the last three months isn't enough for us too put much weight on it, as a single factor.

Does AsiaBaseMetals Boast High Insider Ownership?

Many investors like to check how much of a company is owned by insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. AsiaBaseMetals insiders own about CA$2.7m worth of shares (which is 68% 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.

So What Do The AsiaBaseMetals Insider Transactions Indicate?

We note a that there has been a bit of insider buying recently (but no selling). Overall the buying isn't worth writing home about. It's heartening that insiders own plenty of stock, but we'd like to see more insider buying, since the last year of AsiaBaseMetals insider transactions don't fill us with confidence. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. For example - AsiaBaseMetals has 5 warning signs we think you should be aware of.

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.