Critical Minerals Group's AU$1.1m Market Cap Fall Books Insider Losses
Insiders who acquired AU$362.7k worth of Critical Minerals Group Limited's (ASX:CMG) stock at an average price of AU$0.12 in the past 12 months may be dismayed by the recent 13% price decline. Insiders purchase with the hope of seeing their investments increase in value over time. However, due to recent losses, their initial investment is now only worth AU$188.1k, which is not great.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.
The Last 12 Months Of Insider Transactions At Critical Minerals Group
In the last twelve months, the biggest single purchase by an insider was when insider Gerhard Redelinghuys bought AU$148k worth of shares at a price of AU$0.11 per share. That means that even when the share price was higher than AU$0.06 (the recent price), an insider wanted to purchase shares. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. 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. We note that Gerhard Redelinghuys was both the biggest buyer and the biggest seller.
Over the last year, we can see that insiders have bought 3.13m shares worth AU$363k. On the other hand they divested 55.18k shares, for AU$13k. Overall, Critical Minerals Group insiders were net buyers during the last year. 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!
Check out our latest analysis for Critical Minerals Group
Critical Minerals Group is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.
Does Critical Minerals Group 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. A high insider ownership often makes company leadership more mindful of shareholder interests. From our data, it seems that Critical Minerals Group insiders own 5.9% of the company, worth about AU$425k. But they may have an indirect interest through a corporate structure that we haven't picked up on. Whilst better than nothing, we're not overly impressed by these holdings.
So What Does This Data Suggest About Critical Minerals Group Insiders?
It doesn't really mean much that no insider has traded Critical Minerals Group shares in the last quarter. But insiders have shown more of an appetite for the stock, over the last year. While we have no worries about the insider transactions, we'd be more comfortable if they owned more Critical Minerals Group stock. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Every company has risks, and we've spotted 4 warning signs for Critical Minerals Group you should know about.
But note: Critical Minerals Group 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.