Insiders In Wesizwe Platinum Left Out From 16% Price Rise After Disposing Stock

Despite a 16% gain in Wesizwe Platinum Limited's (JSE:WEZ) stock price this week, shareholders shouldn't let up. In spite of the relatively cheap prices, insiders made the decision to sell R2.3m worth of stock in the last 12 months. This could be a warning indicator of vulnerabilities in the future.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

Check out our latest analysis for Wesizwe Platinum

The Last 12 Months Of Insider Transactions At Wesizwe Platinum

The Independent Non-Executive Director, Lincoln Ngculu, made the biggest insider sale in the last 12 months. That single transaction was for R1.7m worth of shares at a price of R0.76 each. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. The good news is that this large sale was at well above current price of R0.50. So it may not tell us anything about how insiders feel about the current share price. Lincoln Ngculu was the only individual insider to sell shares in the last twelve months.

Lincoln Ngculu sold a total of 3.56m shares over the year at an average price of R0.65. 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!

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

Insider Ownership Of Wesizwe Platinum

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. I reckon it's a good sign if insiders own a significant number of shares in the company. From what we can see in our data, insiders own only about R1.1m worth of Wesizwe Platinum shares. But they may have an indirect interest through a corporate structure that we haven't picked up on. We might be missing something but that seems like very low insider ownership.

So What Do The Wesizwe Platinum Insider Transactions Indicate?

There haven't been any insider transactions in the last three months -- that doesn't mean much. The insider transactions at Wesizwe Platinum are not inspiring us to buy. And usually insiders own more stock in the company, according to our data. While we like knowing 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. Our analysis shows 5 warning signs for Wesizwe Platinum (4 make us uncomfortable!) and we strongly recommend you look at them before investing.

But note: Wesizwe Platinum 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 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.