Pure Gold Mining Inc. (CVE:PGM) shareholders (or potential shareholders) will be happy to see that insider Eric Sprott recently bought a whopping CA$3.9m worth of stock, at a price of CA$1.95. While that only increased their holding size by 4.4%, it is still a big swing by our standards.
Pure Gold Mining Insider Transactions Over The Last Year
Notably, that recent purchase by insider Eric Sprott was not the only time they bought Pure Gold Mining shares this year. They previously made an even bigger purchase of CA$10m worth of shares at a price of CA$1.05 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of CA$1.89. 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.
Happily, we note that in the last year insiders paid CA$14m for 12.00m shares. But they sold 1.66m shares for CA$3.0m. In total, Pure Gold Mining insiders bought more than they sold over the last year. Their average price was about CA$1.20. To my mind it is good that insiders have invested their own money in the company. However, you should keep in mind that they bought when the share price was meaningfully below today’s levels. 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!
Pure Gold Mining is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
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. Pure Gold Mining insiders own about CA$118m worth of shares. That equates to 15% of the company. We’ve certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
So What Does This Data Suggest About Pure Gold Mining Insiders?
The recent insider purchase is heartening. We also take confidence from the longer term picture of insider transactions. However, we note that the company didn’t make a profit over the last twelve months, which makes us cautious. When combined with notable insider ownership, these factors suggest Pure Gold Mining insiders are well aligned, and quite possibly think the share price is too low. One for the watchlist, at least! In addition to knowing about insider transactions going on, it’s beneficial to identify the risks facing Pure Gold Mining. Our analysis shows 5 warning signs for Pure Gold Mining (1 shouldn’t be ignored!) and we strongly recommend you look at them before investing.
Of course Pure Gold Mining may not be the best stock to buy. So you may wish to see this free collection of high quality companies.
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.
This article by Simply Wall St is general in nature. 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.
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