One African Rainbow Minerals Insider Raised Stake By 43% In Previous Year

From what we can see, insiders were net buyers in African Rainbow Minerals Limited's (JSE:ARI ) during the past 12 months. That is, insiders acquired the stock in greater numbers than they sold it.

Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.

Check out our latest analysis for African Rainbow Minerals

The Last 12 Months Of Insider Transactions At African Rainbow Minerals

Over the last year, we can see that the biggest insider purchase was by Executive Director & CEO of ARM Platinum H. Mkatshana for R21m worth of shares, at about R260 per share. That means that even when the share price was higher than R164 (the recent price), an insider wanted to purchase shares. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. In our view, the price an insider pays for shares is very important. Generally speaking, it catches our eye when an insider has purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price. H. Mkatshana was the only individual insider to buy shares in the last twelve months.

The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

African Rainbow Minerals is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

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. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 0.6% of African Rainbow Minerals shares, worth about R199m. 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 African Rainbow Minerals Tell Us?

It doesn't really mean much that no insider has traded African Rainbow Minerals shares in the last quarter. On a brighter note, the transactions over the last year are encouraging. Judging from their transactions, and high insider ownership, African Rainbow Minerals insiders feel good about the company's 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. At Simply Wall St, we've found that African Rainbow Minerals has 2 warning signs (1 makes us a bit uncomfortable!) that deserve your attention before going any further with your analysis.

Of course African Rainbow Minerals 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 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.