Insiders who purchased Central African Gold Inc. (CVE:CAGR) earlier this year lose an additional US$32k as the stock sinks to CA$0.17

The recent price decline of 20% in Central African Gold Inc.'s (CVE:CAGR) stock may have disappointed insiders who bought US$250k worth of shares at an average price of US$0.20 in the past 12 months. This is not good as insiders invest based on expectations that their money will appreciate over time. However, as a result of recent losses, their original investment is now worth only US$219k.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.

View our latest analysis for Central African Gold

Central African Gold Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when Independent Director Michael Townsend bought CA$75k worth of shares at a price of CA$0.15 per share. We do like to see buying, but this purchase was made at well below the current price of CA$0.17. 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.

Michael Townsend bought a total of 1.25m shares over the year at an average price of CA$0.20. 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!

There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).

Insider Ownership of Central African Gold

Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 20% of Central African Gold shares, worth about CA$1.8m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Does This Data Suggest About Central African Gold Insiders?

It doesn't really mean much that no insider has traded Central African Gold shares in the last quarter. However, our analysis of transactions over the last year is heartening. Insiders do have a stake in Central African Gold and their transactions don't cause us concern. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. When we did our research, we found 6 warning signs for Central African Gold (4 are significant!) that we believe deserve your full attention.

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, but not derivative transactions.

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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.
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