Insiders Enjoy AU$646k Return After Buying Gateway Mining Stock

Insiders who purchased Gateway Mining Limited (ASX:GML) shares in the past 12 months are unlikely to be deeply impacted by the stock's 15% decline over the past week. After taking the recent loss into consideration, the AU$5.22m worth of stock they bought is now worth AU$5.87m, indicating that their investment yielded a positive return.

While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.

We've found 21 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free.

The Last 12 Months Of Insider Transactions At Gateway Mining

Over the last year, we can see that the biggest insider purchase was by insider Shane Ball for AU$4.1m worth of shares, at about AU$0.056 per share. We do like to see buying, but this purchase was made at well below the current price of AU$0.063. 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.

Gateway Mining insiders may have bought shares in the last year, but they didn't sell any. You can see the insider transactions (by companies and 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!

View our latest analysis for Gateway Mining

Gateway Mining is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.

Insiders At Gateway Mining Have Bought Stock Recently

Over the last quarter, Gateway Mining insiders have spent a meaningful amount on shares. We can see that insider Shane Ball paid AU$120k for shares in the company. No-one sold. This could be interpreted as suggesting a positive outlook.

Does Gateway Mining Boast High 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. We usually like to see fairly high levels of insider ownership. It appears that Gateway Mining insiders own 17% of the company, worth about AU$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 Gateway Mining Insiders?

It's certainly positive to see the recent insider purchase. We also take confidence from the longer term picture of insider transactions. But on the other hand, the company made a loss during the last year, which makes us a little cautious. Given that insiders also own a fair bit of Gateway Mining we think they are probably pretty confident of a bright future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Gateway Mining. Case in point: We've spotted 2 warning signs for Gateway Mining you should be aware of, and 1 of these doesn't sit too well with us.

Of course Gateway 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 of direct interests only, but not derivative transactions or indirect interests.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.