Nio Strategic Metals Gains 36%, Insider Trades Reap Benefit

Nio Strategic Metals Inc. (CVE:NIO) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 36%, resulting in a CA$4.1m rise in the company's market capitalisation, translating to a gain of 228% on their initial investment. As a result, their original purchase of CA$481.8k worth of stock is now worth CA$1.58m.

While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.

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Nio Strategic Metals Insider Transactions Over The Last Year

The insider Mark Wallace made the biggest insider purchase in the last 12 months. That single transaction was for CA$450k worth of shares at a price of CA$0.045 each. We do like to see buying, but this purchase was made at well below the current price of CA$0.15. 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.

In the last twelve months Nio Strategic Metals insiders were buying shares, but not selling. 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!

View our latest analysis for Nio Strategic Metals

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. Nio Strategic Metals insiders own about CA$6.7m worth of shares (which is 51% of the company). I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

What Might The Insider Transactions At Nio Strategic Metals Tell Us?

The fact that there have been no Nio Strategic Metals insider transactions recently certainly doesn't bother us. On a brighter note, the transactions over the last year are encouraging. With high insider ownership and encouraging transactions, it seems like Nio Strategic Metals insiders think the business has merit. While it's good to be aware of 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 example, Nio Strategic Metals has 5 warning signs (and 3 which are potentially serious) we think you should know about.

If you would prefer to check out another company -- one with potentially superior financials -- then do not 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 of direct interests only, but not derivative transactions or indirect interests.

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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 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.