NV Gold Corporation (CVE:NVX) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 13%, resulting in a CA$8.3m rise in the company's market capitalisation, translating to a gain of 331% on their initial investment. As a result, the stock they originally bought for CA$437.0k is now worth CA$1.88m.
Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.
NV Gold Insider Transactions Over The Last Year
The President John Watson made the biggest insider purchase in the last 12 months. That single transaction was for CA$214k worth of shares at a price of CA$0.30 each. We do like to see buying, but this purchase was made at well below the current price of CA$1.03. 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.
Over the last year, we can see that insiders have bought 1.83m shares worth CA$437k. On the other hand they divested 11.30k shares, for CA$10k. In total, NV Gold insiders bought more than they sold over the last year. The average buy price was around CA$0.24. It is certainly positive to see that insiders have invested their own money in the company. But we must note that the investments were made at well below today's share price. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
See our latest analysis for NV Gold
NV Gold 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.
Have NV Gold Insiders Traded Recently?
We saw some NV Gold insider buying shares in the last three months. In total, insiders bought CA$18k worth of shares in that time. On the other hand, Independent Director John Kerr sold CA$10k worth of shares. It is good to see that insiders have been buying, but they did not buy very many shares, in the scheme of things.
Does NV Gold Boast High 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. It's great to see that NV Gold insiders own 43% of the company, worth about CA$17m. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
So What Does This Data Suggest About NV Gold Insiders?
Our data shows a little insider buying, but no selling, in the last three months. The net investment is not enough to encourage us much. On a brighter note, the transactions over the last year are encouraging. With high insider ownership and encouraging transactions, it seems like NV Gold insiders think the business has merit. 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. When we did our research, we found 4 warning signs for NV Gold (3 are a bit concerning!) that we believe deserve your full attention.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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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