Bullish Rua Gold Insider Buying Worth CA$799.2k Yet To Pay Off

The recent price decline of 13% in Rua Gold Inc.'s (CVE:RUA) stock may have disappointed insiders who bought CA$799.2k worth of shares at an average price of CA$0.17 in the past 12 months. This is not good as insiders invest based on expectations that their money will appreciate over time. However, as a result of recent losses, their original investment is now worth only CA$654.7k.

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.

View our latest analysis for Rua Gold

Rua Gold Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when Chairman Oliver Lennox-King bought CA$250k worth of shares at a price of CA$0.18 per share. That means that even when the share price was higher than CA$0.14 (the recent price), an insider wanted to purchase shares. It's very possible they regret the purchase, but it's more likely they are bullish about the company. In our view, the price an insider pays for shares is very important. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.

While Rua Gold insiders bought shares during the last year, they didn't sell. 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!

Rua 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.

Are Rua Gold Insiders Buying Or Selling?

We've only seen a tiny insider purchase valued at CA$6.2k, in the last three months. So it is hard to draw any conclusion about how insiders are feeling about the stock, from these recent trades.

Does Rua Gold Boast High Insider Ownership?

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Our data indicates that Rua Gold insiders own about CA$4.3m worth of shares (which is 13% of the company). Whilst better than nothing, we're not overly impressed by these holdings.

What Might The Insider Transactions At Rua Gold Tell Us?

Our data shows a little insider buying, but no selling, in the last three months. That said, the purchases were not large. However, our analysis of transactions over the last year is heartening. The transactions are fine but it'd be more encouraging if Rua Gold insiders bought more shares in the company. 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. At Simply Wall St, we've found that Rua Gold has 4 warning signs (2 make us uncomfortable!) that deserve your attention before going any further with your analysis.

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.