Aurania Resources Stock Down 10.0% But Insiders Still In CA$1.0m Profit

Aurania Resources Ltd. (CVE:ARU) insiders who acquired shares over the previous 12 months, can probably afford to ignore the recent 10.0% decline in the stock price. Even after accounting for the recent loss, the CA$487.3k worth of stock purchased by them is now worth CA$1.53m or in other words, their investment continues to give good returns.

While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.

See our latest analysis for Aurania Resources

The Last 12 Months Of Insider Transactions At Aurania Resources

The Executive Chairman Keith Barron made the biggest insider purchase in the last 12 months. That single transaction was for CA$461k worth of shares at a price of CA$0.20 each. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of CA$0.63. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.

While Aurania Resources insiders bought shares during the last year, they didn't sell. 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!

Aurania Resources is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.

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. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It's great to see that Aurania Resources insiders own 44% of the company, worth about CA$28m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Do The Aurania Resources Insider Transactions Indicate?

It doesn't really mean much that no insider has traded Aurania Resources shares in the last quarter. On a brighter note, the transactions over the last year are encouraging. Judging from their transactions, and high insider ownership, Aurania Resources insiders feel good about the company's future. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For example, Aurania Resources has 8 warning signs (and 4 which are significant) we think you should know about.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity and low debt.

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.