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Insiders who acquired US$118.0k worth of Patagonia Gold Corp.'s (CVE:PGDC) stock at an average price of US$0.062 in the past 12 months may be dismayed by the recent 13% price decline. Insiders buy with the expectation to see their investments rise in value over a period of time. However, recent losses have rendered their above investment worth US$66.5k which is not ideal.
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 Patagonia Gold
The Last 12 Months Of Insider Transactions At Patagonia Gold
The Independent Director Timothy Hunt made the biggest insider purchase in the last 12 months. That single transaction was for CA$93k worth of shares at a price of CA$0.11 each. That means that even when the share price was higher than CA$0.035 (the recent price), an insider wanted to purchase shares. 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. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.
Over the last year, we can see that insiders have bought 1.90m shares worth CA$118k. On the other hand they divested 5.00k shares, for CA$100.0. Overall, Patagonia Gold insiders were net buyers during the last year. Their average price was about CA$0.062. This is nice to see since it implies that insiders might see value around current prices. 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!
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.
Are Patagonia Gold Insiders Buying Or Selling?
There was only a small bit of insider buying, worth CA$2.2k, in the last three months. So it is hard to draw any conclusion about how insiders are feeling about the stock, from these recent trades.
Insider Ownership
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. I reckon it's a good sign if insiders own a significant number of shares in the company. Patagonia Gold insiders own 65% of the company, currently worth about CA$11m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.