Insiders Buying Kalo Gold Might Wish They Invested More, Stock Gains 13%

Insiders who bought Kalo Gold Corp. (CVE:KALO) stock in the last 12 months were richly rewarded last week. The company's market value increased by CA$956k as a result of the stock's 13% gain over the same period. Put another way, the original CA$219.0k acquisition is now worth CA$342.0k.

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.

Check out our latest analysis for Kalo Gold

Kalo Gold Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when Executive VP of Capital Markets Kevin Ma bought CA$91k worth of shares at a price of CA$0.03 per share. Even though the purchase was made at a significantly lower price than the recent price (CA$0.045), we still think insider buying is a positive. 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.

Kalo Gold insiders may have bought shares in the last year, but they didn't sell any. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

Kalo Gold is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.

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 19% of Kalo Gold shares, worth about CA$1.6m. 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 Kalo Gold Insider Transactions Indicate?

The fact that there have been no Kalo Gold insider transactions recently certainly doesn't bother us. However, our analysis of transactions over the last year is heartening. Insiders own shares in Kalo Gold and we see no evidence to suggest they are worried about the future. While it's good to be aware of 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. For example - Kalo Gold has 6 warning signs we think you should be aware of.

Of course Kalo Gold 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.