As Whitehorse Gold Corp.'s (CVE:WHG)) market cap dropped by CA$12m, insiders who sold CA$931k worth of stock were able to offset their losses

By
Simply Wall St
Published
August 22, 2021
TSXV:WHG
Source: Shutterstock

Over the past year, insiders sold CA$931k worth of Whitehorse Gold Corp. (CVE:WHG) stock at an average price of CA$1.97 per share allowing them to get the most out of their money. The company’s market cap plunged by CA$12m after price dropped by 17% last week but insiders were able to limit their loss to an extent.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

View our latest analysis for Whitehorse Gold

The Last 12 Months Of Insider Transactions At Whitehorse Gold

The insider, Yong-Jae Kim, made the biggest insider sale in the last 12 months. That single transaction was for CA$189k worth of shares at a price of CA$1.89 each. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. The good news is that this large sale was at well above current price of CA$1.10. So it may not shed much light on insider confidence at current levels.

Over the last year, we can see that insiders have bought 230.00k shares worth CA$366k. But insiders sold 472.15k shares worth CA$931k. Over the last year we saw more insider selling of Whitehorse Gold shares, than buying. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. 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:WHG Insider Trading Volume August 23rd 2021

I will like Whitehorse Gold better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

Insiders at Whitehorse Gold Have Sold Stock Recently

The last three months saw significant insider selling at Whitehorse Gold. In total, insiders dumped CA$174k worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.

Insider Ownership of Whitehorse Gold

Many investors like to check how much of a company is owned by 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 11% of Whitehorse Gold shares, worth about CA$6.2m, according to our data. Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!

So What Does This Data Suggest About Whitehorse Gold Insiders?

Insiders sold Whitehorse Gold shares recently, but they didn't buy any. Zooming out, the longer term picture doesn't give us much comfort. When you combine this with the relatively low insider ownership, we are very cautious about the stock. So we'd only buy after very careful consideration. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. In terms of investment risks, we've identified 4 warning signs with Whitehorse Gold and understanding these should be part of your investment process.

Of course Whitehorse 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, but not derivative transactions.

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