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We often see insiders buying up shares in companies that perform well over the long term. On the other hand, we’d be remiss not to mention that insider sales have been known to precede tough periods for a business. So we’ll take a look at whether insiders have been buying or selling shares in Emerald Resources NL (ASX:EMR).
Do Insider Transactions Matter?
It’s quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, most countries require that the company discloses such transactions to the market.
We don’t think shareholders should simply follow insider transactions. But it is perfectly logical to keep tabs on what insiders are doing. As Peter Lynch said, ‘insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.’
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The Last 12 Months Of Insider Transactions At Emerald Resources
Over the last year, we can see that the biggest insider purchase was by Non-Executive Chairman Simon Lee for AU$4.0m worth of shares, at about AU$0.03 per share. That means that an insider was happy to buy shares at around the current price. Of course they may have changed their mind. But this suggests they are optimistic. Nonetheless, we consider it positive if insiders want to buy at around the current share price.
In the last twelve months insiders paid AU$12m for 406.67m shares purchased. Overall, Emerald Resources insiders were net buyers last year. The average buy price was around AU$0.03. It’s great to see insiders putting their own cash into the company’s stock, albeit at below the recent share price (AU$0.037). You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Emerald Resources 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.
Emerald Resources Insiders Bought Stock Recently
It’s good to see that Emerald Resources insiders have made notable investments in the company’s shares. In total, insiders bought AU$12m worth of shares in that time, and we didn’t record any sales whatsoever. This could be interpreted as suggesting a positive outlook.