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Some of the losses seen by insiders who purchased CA$955.0k worth of Abasca Resources Inc. (CVE:ABA) shares over the past year were recovered after the stock increased by 37% over the past week. However, the purchase is proving to be a costly gamble, since losses made by insiders have totalled CA$458k since the time of purchase.
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.
View our latest analysis for Abasca Resources
The Last 12 Months Of Insider Transactions At Abasca Resources
In the last twelve months, the biggest single purchase by an insider was when CEO, President & Director Dawn Zhou bought CA$940k worth of shares at a price of CA$0.25 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being CA$0.13). 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. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.
Abasca 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 want to know exactly who sold, for how much, and when, simply click on the graph below!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.
Insider Ownership Of Abasca Resources
For a common shareholder, it is worth checking how many shares are held by company 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. Abasca Resources insiders own about CA$5.0m worth of shares (which is 73% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
So What Do The Abasca Resources Insider Transactions Indicate?
It doesn't really mean much that no insider has traded Abasca Resources shares in the last quarter. But insiders have shown more of an appetite for the stock, over the last year. It would be great to see more insider buying, but overall it seems like Abasca Resources insiders are reasonably well aligned (owning significant chunk of the company's shares) and optimistic for the future. 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 Abasca Resources (of which 3 are potentially serious!) you should know about.