Apollo Silver's Recent Gains Improve Losses On Insider Purchases Worth CA$18.4m

Insiders who bought CA$18.4m worth of Apollo Silver Corp. (CVE:APGO) stock in the last year have seen some of their losses recouped as the stock gained 26% last week. However, the purchase is proving to be a costly gamble, since losses made by insiders have totalled CA$4.7m since the time of purchase.

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.

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The Last 12 Months Of Insider Transactions At Apollo Silver

Over the last year, we can see that the biggest insider purchase was by insider Eric Sprott for CA$13m worth of shares, at about CA$5.00 per share. That means that even when the share price was higher than CA$3.28 (the recent price), an insider wanted to purchase shares. Their view may have changed since then, but at least it shows they felt optimistic at the time. To us, it's very important to consider the price insiders pay for shares. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.

Happily, we note that in the last year insiders paid CA$18m for 4.15m shares. But insiders sold 140.00k shares worth CA$639k. Overall, Apollo Silver insiders were net buyers during the last year. The average buy price was around CA$4.42. This is nice to see since it implies that insiders might see value around current prices. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

Check out our latest analysis for Apollo Silver

Apollo Silver is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.

Apollo Silver Insiders Bought Stock Recently

Over the last three months, we've seen significant insider buying at Apollo Silver. In total, insiders bought CA$608k worth of shares in that time, and we didn't record any sales whatsoever. That shows some optimism about the company's future.

Insider Ownership

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It appears that Apollo Silver insiders own 16% of the company, worth about CA$32m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Does This Data Suggest About Apollo Silver Insiders?

The recent insider purchases are heartening. We also take confidence from the longer term picture of insider transactions. But we don't feel the same about the fact the company is making losses. Insiders likely see value in Apollo Silver shares, given these transactions (along with notable insider ownership of the company). 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 found 3 warning signs for Apollo Silver that deserve your attention before buying any shares.

But note: Apollo Silver may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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.