Don't Ignore The Insider Selling In Oceanic Iron Ore

Anyone interested in Oceanic Iron Ore Corp. (CVE:FEO) should probably be aware that the Independent Director, John Reynolds, recently divested CA$200k worth of shares in the company, at an average price of CA$0.95 each. That sale was 22% of their holding, so it does make us raise an eyebrow.

AI is about to change healthcare. These 20 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10bn in marketcap - there is still time to get in early.

Oceanic Iron Ore Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when insider Frank Giustra bought CA$560k worth of shares at a price of CA$0.25 per share. We do like to see buying, but this purchase was made at well below the current price of CA$1.02. 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.

Happily, we note that in the last year insiders paid CA$895k for 3.36m shares. But insiders sold 1.86m shares worth CA$547k. Overall, Oceanic Iron Ore insiders were net buyers during the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

See our latest analysis for Oceanic Iron Ore

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.

Insider Ownership

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. We usually like to see fairly high levels of insider ownership. Oceanic Iron Ore insiders own about CA$42m worth of shares. That equates to 27% of the company. 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 Do The Oceanic Iron Ore Insider Transactions Indicate?

The recent insider purchases are heartening. And an analysis of the transactions over the last year also gives us confidence. But we don't feel the same about the fact the company is making losses. Insiders likely see value in Oceanic Iron Ore shares, given these transactions (along with notable insider ownership of the company). In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Oceanic Iron Ore. Case in point: We've spotted 5 warning signs for Oceanic Iron Ore you should be aware of, and 4 of these are potentially serious.

Of course Oceanic Iron Ore 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.