Have Insiders Been Buying Newcore Gold Ltd. (CVE:NCAU) Shares This Year?

We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. On the other hand, we'd be remiss not to mention that insider sales have been known to precede tough periods for a business. So we'll take a look at whether insiders have been buying or selling shares in Newcore Gold Ltd. (CVE:NCAU).

What Is Insider Buying?

Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock in the company. However, most countries require that the company discloses such transactions to the market.

We don't think shareholders should simply follow insider transactions. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Columbia University study found that 'insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers'.

Check out our latest analysis for Newcore Gold

The Last 12 Months Of Insider Transactions At Newcore Gold

The President Luke Alexander made the biggest insider purchase in the last 12 months. That single transaction was for CA$525k worth of shares at a price of CA$0.20 each. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of CA$0.61. 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.

Newcore Gold insiders may have bought shares in the last year, but they didn't sell any. The average buy price was around CA$0.25. 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 want to know exactly who sold, for how much, and when, simply click on the graph below!

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

Insiders at Newcore Gold Have Bought Stock Recently

There was some insider buying at Newcore Gold over the last quarter. Insiders purchased CA$23k worth of shares in that period. It's great to see that insiders are only buying, not selling. But in this case the amount purchased means the recent transaction may not be very meaningful on its own.

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Insiders own 27% of Newcore Gold shares, worth about CA$16m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

What Might The Insider Transactions At Newcore Gold Tell Us?

Our data shows a little insider buying, but no selling, in the last three months. Overall the buying isn't worth writing home about. However, our analysis of transactions over the last year is heartening. Insiders own shares in Newcore Gold and we see no evidence to suggest they are worried about the future. 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, Newcore Gold has 5 warning signs (and 2 which are potentially serious) we think you should know about.

But note: Newcore 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, but not derivative transactions.

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This article by Simply Wall St is general in nature. 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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