Goldshore Resources Insider Buyers Pleased With CA$3.2m Return On Investment

Insiders who bought Goldshore Resources Inc. (CVE:GSHR) stock lover the last 12 months are probably not as affected by last week’s 13% loss. Reason being, despite the recent loss, insiders original purchase value of CA$3.20m is now worth CA$6.41m.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

View our latest analysis for Goldshore Resources

Goldshore Resources Insider Transactions Over The Last Year

The insider Brian Paes-Braga made the biggest insider purchase in the last 12 months. That single transaction was for CA$1.5m worth of shares at a price of CA$0.10 each. We do like to see buying, but this purchase was made at well below the current price of CA$0.26. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.

In the last twelve months insiders purchased 24.64m shares for CA$3.2m. But they sold 173.00k shares for CA$51k. Overall, Goldshore Resources insiders were net buyers during the last year. The average buy price was around CA$0.13. To my mind it is good that insiders have invested their own money in the company. However, we do note that they were buying at significantly lower prices than today's share price. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

Goldshore 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.

Insiders At Goldshore Resources Have Bought Stock Recently

There has been significantly more insider buying, than selling, at Goldshore Resources, over the last three months. In total, five insiders bought CA$1.2m worth of shares in that time. But insiders only sold shares worth CA$51k. Insiders have spent more buying shares than they have selling, so on balance we think they are are probably optimistic.

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. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 18% of Goldshore Resources shares, worth about CA$15m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Do The Goldshore Resources Insider Transactions Indicate?

The recent insider purchases are heartening. We also take confidence from the longer term picture of insider transactions. But we don't feel the same about the fact the company is making losses. When combined with notable insider ownership, these factors suggest Goldshore Resources insiders are well aligned, and that they may think the share price is too low. 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, Goldshore Resources has 4 warning signs (and 2 which don't sit too well with us) we think you should know about.

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.