Insider Buying: The Red Moon Resources Inc. (CVE:RMK) Director Just Bought 59% More Shares

By
Simply Wall St
Published
June 10, 2021
TSXV:RMK

Even if it's not a huge purchase, we think it was good to see that John Anderson, the Director of Red Moon Resources Inc. (CVE:RMK) recently shelled out CA$76k to buy stock, at CA$0.76 per share. Even though that isn't a massive buy, it did increase their holding by 59%, which is arguably a good sign.

See our latest analysis for Red Moon Resources

Red Moon Resources Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the CEO & Director, Patrick Laracy, sold CA$400k worth of shares at a price of CA$0.40 per share. That means that an insider was selling shares at slightly below the current price (CA$0.87). When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. We note that the biggest single sale was only 24% of Patrick Laracy's holding. The only individual insider seller over the last year was Patrick Laracy. Notably Patrick Laracy was also the biggest buyer, having purchased CA$200k worth of shares.

Happily, we note that in the last year insiders paid CA$200k for 647.14k shares. On the other hand they divested 1.00m shares, for CA$400k. 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!

insider-trading-volume
TSXV:RMK Insider Trading Volume June 11th 2021

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

Does Red Moon Resources Boast High Insider Ownership?

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. Insiders own 6.0% of Red Moon Resources shares, worth about CA$3.8m, according to our data. Whilst better than nothing, we're not overly impressed by these holdings.

So What Does This Data Suggest About Red Moon Resources Insiders?

It is good to see recent purchasing. However, the longer term transactions are not so encouraging. Neither the level of insider ownership, nor the transactions over the last twelve months inspire us, but we think the recent buying is positive. 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. Our analysis shows 4 warning signs for Red Moon Resources (1 shouldn't be ignored!) and we strongly recommend you look at them before investing.

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, but not derivative transactions.

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