Bullish Mirasol Resources Insider Buying Worth CA$3.67m Yet To Pay Off
Insiders who acquired CA$3.67m worth of Mirasol Resources Ltd.'s (CVE:MRZ) stock at an average price of CA$0.43 in the past 12 months may be dismayed by the recent 14% price decline. This is not good as insiders invest based on expectations that their money will appreciate over time. However, as a result of recent losses, their original investment is now worth only CA$2.56m.
While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
Mirasol Resources Insider Transactions Over The Last Year
The Independent Director John Tognetti made the biggest insider purchase in the last 12 months. That single transaction was for CA$1.5m worth of shares at a price of CA$0.45 each. That means that an insider was happy to buy shares at above the current price of CA$0.30. 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. In our view, the price an insider pays for shares is very important. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.
Mirasol Resources insiders may have bought shares in the last year, but they didn't sell any. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
See our latest analysis for Mirasol Resources
Mirasol Resources 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.
Insiders At Mirasol Resources Have Bought Stock Recently
Over the last quarter, Mirasol Resources insiders have spent a meaningful amount on shares. We can see that insider Glenn Pountney paid CA$262k for shares in the company. No-one sold. This makes one think the business has some good points.
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. Mirasol Resources insiders own 47% of the company, currently worth about CA$13m based on the recent share price. 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 Mirasol Resources Tell Us?
It is good to see the recent insider purchase. And the longer term insider transactions also give us confidence. But on the other hand, the company made a loss during the last year, which makes us a little cautious. Once you factor in the high insider ownership, it certainly seems like insiders are positive about Mirasol Resources. One for the watchlist, at least! 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. Every company has risks, and we've spotted 4 warning signs for Mirasol Resources (of which 3 are potentially serious!) you should know about.
Of course Mirasol Resources 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.
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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.