It is not uncommon to see companies perform well in the years after insiders buy shares. On the other hand, we'd be remiss not to mention that insider sales have been known to precede tough periods for a business. So shareholders might well want to know whether insiders have been buying or selling shares in Margaux Resources Ltd. (CVE:MRL).
What Is Insider Buying?
It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, rules govern insider transactions, and certain disclosures are required.
Insider transactions are not the most important thing when it comes to long-term investing. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year.
The Last 12 Months Of Insider Transactions At Margaux Resources
Over the last year, we can see that the biggest insider purchase was by Chairman of the Board James Letwin for CA$70k worth of shares, at about CA$0.10 per share. So it's clear an insider wanted to buy, at around the current price, which is CA$0.10. 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. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. The good news for Margaux Resources share holders is that insiders were buying at near the current price.
While Margaux Resources insiders bought shares last year, they didn't sell. The chart below shows insider transactions (by individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Margaux Resources is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Does Margaux Resources Boast High Insider Ownership?
Many investors like to check how much of a company is owned by 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. Based on our data, Margaux Resources insiders have about 3.8% of the stock, worth approximately CA$417k. We consider this fairly low insider ownership.
So What Do The Margaux Resources Insider Transactions Indicate?
It doesn't really mean much that no insider has traded Margaux Resources 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 Margaux Resources stock. Along with insider transactions, I recommend checking if Margaux Resources is growing revenue. This free chart of historic revenue and earnings should make that easy.
Of course Margaux 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, but not derivative transactions.
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