Insider Sellers Might Regret Selling Rusoro Mining Shares at a Lower Price Than Current Market Value

Even though Rusoro Mining Ltd. (CVE:RML) has fallen by 12% over the past week , insiders who sold US$21m worth of stock over the past year have had less luck. Insiders might have been better off holding onto their shares, given that the average selling price of US$1.23 is still below the current share price.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

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Rusoro Mining Insider Transactions Over The Last Year

Notably, that recent purchase by Independent Director Anthony Beruschi was not the only time they traded Rusoro Mining shares this year. Earlier in the year, they sold shares at a price ofCA$1.25 per share in a -CA$8.7m transaction. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. It's of some comfort that this sale was conducted at a price well above the current share price, which is CA$1.09. So it may not tell us anything about how insiders feel about the current share price.

In the last twelve months insiders purchased 629.70k shares for CA$650k. But they sold 16.78m shares for CA$21m. All up, insiders sold more shares in Rusoro Mining than they bought, over the last year. 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 Rusoro Mining

I will like Rusoro Mining better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Insiders At Rusoro Mining Have Sold Stock Recently

We've seen more insider selling than insider buying at Rusoro Mining recently. In that time, Independent Director Anthony Beruschi dumped CA$7.7m worth of shares. On the other hand we note insiders bought CA$50k worth of shares. Generally this level of net selling might be considered a bit bearish.

Does Rusoro Mining Boast High Insider Ownership?

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. It's great to see that Rusoro Mining insiders own 19% of the company, worth about CA$143m. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

What Might The Insider Transactions At Rusoro Mining Tell Us?

Unfortunately, there has been more insider selling of Rusoro Mining stock, than buying, in the last three months. And our longer term analysis of insider transactions didn't bring confidence, either. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. 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. Case in point: We've spotted 5 warning signs for Rusoro Mining you should be aware of, and 4 of them don't sit too well with us.

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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.