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Generally, when a single insider buys stock, it is usually not a big deal. However, when several insiders are buying, like in the case of Miramar Resources Limited (ASX:M2R), it sends a favourable message to the company's shareholders.
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 Miramar Resources
The Last 12 Months Of Insider Transactions At Miramar Resources
Over the last year, we can see that the biggest insider purchase was by insider David Cleary for AU$282k worth of shares, at about AU$0.16 per share. Even though the purchase was made at a significantly lower price than the recent price (AU$0.18), we still think insider buying is a positive. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.
While Miramar Resources 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!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
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 30% of Miramar Resources shares, worth about AU$3.1m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
So What Do The Miramar Resources Insider Transactions Indicate?
The fact that there have been no Miramar Resources insider transactions recently certainly doesn't bother us. But insiders have shown more of an appetite for the stock, over the last year. Insiders do have a stake in Miramar Resources and their transactions don't cause us concern. 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 Miramar Resources has 5 warning signs (2 can't be ignored!) that deserve your attention before going any further with your analysis.