Insiders who bought Canadian Gold Corp. (CVE:CGC) in the last 12 months may probably not pay attention to the stock's recent 17% drop. Even after accounting for the recent loss, the CA$3.00m worth of stock purchased by them is now worth CA$10.5m or in other words, their investment continues to give good returns.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
See our latest analysis for Canadian Gold
The Last 12 Months Of Insider Transactions At Canadian Gold
The insider Robert McEwen made the biggest insider purchase in the last 12 months. That single transaction was for CA$3.0m worth of shares at a price of CA$0.05 each. Even though the purchase was made at a significantly lower price than the recent price (CA$0.17), we still think insider buying is a positive. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.
You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Canadian Gold is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Does Canadian Gold Boast High Insider Ownership?
Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Canadian Gold insiders own 42% of the company, currently worth about CA$12m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
So What Do The Canadian Gold Insider Transactions Indicate?
There haven't been any insider transactions in the last three months -- that doesn't mean much. But insiders have shown more of an appetite for the stock, over the last year. With high insider ownership and encouraging transactions, it seems like Canadian Gold insiders think the business has merit. 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. For instance, we've identified 5 warning signs for Canadian Gold (4 shouldn't be ignored) you should be aware of.