Independent Director of Lavras Gold Rostislav Raykov Buys 4.5% More Shares

Investors who take an interest in Lavras Gold Corp. (CVE:LGC) should definitely note that the Independent Director, Rostislav Raykov, recently paid CA$2.41 per share to buy CA$610k worth of the stock. While that's a very decent purchase to our minds, it was proportionally a bit modest, boosting their holding by just 4.5%.

Check out our latest analysis for Lavras Gold

The Last 12 Months Of Insider Transactions At Lavras Gold

The insider, Eric Sprott, made the biggest insider sale in the last 12 months. That single transaction was for CA$1.0m worth of shares at a price of CA$2.55 each. So what is clear is that an insider saw fit to sell at around the current price of CA$2.50. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. In this case, the big sale took place at around the current price, so it's not too bad (but it's still not a positive). Eric Sprott was the only individual insider to sell over the last year.

Happily, we note that in the last year insiders paid CA$9.0m for 5.10m shares. On the other hand they divested 1.73m shares, for CA$3.9m. In the last twelve months there was more buying than selling by Lavras Gold insiders. They paid about CA$1.77 on average. It is certainly positive to see that insiders have invested their own money in the company. But we must note that the investments were made at well below today's share price. 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!

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

For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 33% of Lavras Gold shares, worth about CA$42m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

What Might The Insider Transactions At Lavras Gold Tell Us?

The recent insider purchases are heartening. And an analysis of the transactions over the last year also gives us confidence. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. Insiders likely see value in Lavras Gold shares, given these transactions (along with notable insider ownership of the company). So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For instance, we've identified 4 warning signs for Lavras Gold (3 are significant) you should be aware of.

But note: Lavras Gold may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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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