Insider Purchases Worth CA$4.53m See Losses As Blue Star Gold Market Value Drops To CA$5.2m

Insiders who bought CA$4.53m worth of Blue Star Gold Corp.'s (CVE:BAU) stock at an average buy price of CA$0.23 over the last year may be disappointed by the recent 23% decrease in the stock. Insiders buy with the expectation to see their investments rise in value over a period of time. However, recent losses have rendered their above investment worth CA$963.6k which is not ideal.

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 Blue Star Gold

The Last 12 Months Of Insider Transactions At Blue Star Gold

The Non-Independent Director Georg Pollert made the biggest insider purchase in the last 12 months. That single transaction was for CA$2.4m worth of shares at a price of CA$0.38 each. That means that even when the share price was higher than CA$0.05 (the recent price), an insider wanted to purchase shares. It's very possible they regret the purchase, but it's more likely they are bullish about the company. We always take careful note of the price insiders pay when purchasing shares. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.

While Blue Star Gold insiders bought shares during the last year, they didn't sell. The average buy price was around CA$0.23. This is nice to see since it implies that insiders might see value around current prices. 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!

There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).

Are Blue Star Gold Insiders Buying Or Selling?

Vice President of Exploration Darren Lindsay bought just CA$2.0k worth of shares in that time. That's not much at all. Looking at the net result, we don't think these recent trades shed much light on how insiders, as a group, are feeling about the company's prospects.

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. A high insider ownership often makes company leadership more mindful of shareholder interests. Blue Star Gold insiders own 64% of the company, currently worth about CA$3.3m based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

What Might The Insider Transactions At Blue Star Gold Tell Us?

Our data shows a little insider buying, but no selling, in the last three months. The net investment is not enough to encourage us much. On a brighter note, the transactions over the last year are encouraging. With high insider ownership and encouraging transactions, it seems like Blue Star Gold insiders think the business has merit. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Blue Star Gold. For instance, we've identified 4 warning signs for Blue Star Gold (3 are a bit unpleasant) you should be aware of.

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.