Generally, when a single insider buys stock, it is usually not a big deal. However, when several insiders are buying, like in the case of Medallion Metals Limited (ASX:MM8), it sends a favourable message to the company's shareholders.
Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.
Check out our latest analysis for Medallion Metals
Medallion Metals Insider Transactions Over The Last Year
The insider Ian Junk made the biggest insider purchase in the last 12 months. That single transaction was for AU$114k worth of shares at a price of AU$0.13 each. That means that even when the share price was higher than AU$0.06 (the recent price), an insider wanted to purchase shares. Their view may have changed since then, but at least it shows they felt optimistic at the time. We always take careful note of the price insiders pay when purchasing shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.
In the last twelve months Medallion Metals insiders were buying shares, but not selling. Their average price was about AU$0.087. I'd consider this a positive as it suggests insiders see value at around the current price. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!
There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).
Insider Ownership Of Medallion Metals
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. Our data indicates that Medallion Metals insiders own about AU$2.6m worth of shares (which is 14% of the company). We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!
What Might The Insider Transactions At Medallion Metals Tell Us?
The fact that there have been no Medallion Metals insider transactions recently certainly doesn't bother us. But insiders have shown more of an appetite for the stock, over the last year. We'd like to see bigger individual holdings. However, we don't see anything to make us think Medallion Metals insiders are doubting the company. While we like knowing 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 5 warning signs for Medallion Metals (2 are a bit concerning!) that we believe deserve your full attention.