Insiders who acquired CA$779k worth of Latin Metals Inc.’s (CVE:LMS) stock at an average price of CA$0.14 in the past 12 months may be disappointed by the recent 20% price decline. Insiders invest with the hopes of seeing their money grow in value over time. However, as a result of recent losses, their initial investment is now only worth CA$436k, which is not what they expected.
Although we don’t think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.
However if you’d rather see where the opportunities and risks are within LMS’ industryyou can check out our analysis on the CA Metals and Mining industry.
Latin Metals Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when Director Robert Kopple bought CA$554k worth of shares at a price of CA$0.15 per share. That means that an insider was happy to buy shares at above the current price of CA$0.08. 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. To us, it’s very important to consider the price insiders pay for shares. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.
While Latin Metals insiders bought shares during the last year, they did not sell. 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!
Latin Metals 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.
Insiders At Latin Metals Have Bought Stock Recently
There was some insider buying at Latin Metals over the last quarter. Insiders purchased CA$17k worth of shares in that period. It’s great to see that insiders are only buying, not selling. But in this case the amount purchased means the recent transaction may not be very meaningful on its own.
Does Latin Metals 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. Latin Metals insiders own 50% of the company, currently worth about CA$2.3m based on the recent share price. This kind of significant ownership by insiders generally increases the chance that the company is run in the interest of all shareholders.
So What Does This Data Suggest About Latin Metals Insiders?
Insider purchases may have been minimal, in the last three months, but there was no selling at all. That said, the purchases were not large. However, our analysis of transactions over the last year is heartening. With high insider ownership and encouraging transactions, it seems like Latin Metals insiders think the business has merit. 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. When we did our research, we found 4 warning signs for Latin Metals (3 shouldn’t be ignored!) that we believe deserve your full attention.
If you would prefer to check out another company — one with potentially superior financials — then don’t miss this free list of interesting companies, that have HIGH return on equity 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, but not derivative transactions.
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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 into account 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.
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