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Insiders who bought Barrick Gold Corporation (TSE:ABX) stock lover the last 12 months are probably not as affected by last week’s 5.1% loss. After accounting for the recent loss, the US$33m worth of shares they purchased is now worth US$34m, suggesting a good return on their investment.
Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.
View our latest analysis for Barrick Gold
Barrick Gold Insider Transactions Over The Last Year
The President Dennis Bristow made the biggest insider purchase in the last 12 months. That single transaction was for CA$5.9m worth of shares at a price of CA$29.66 each. That means that an insider was happy to buy shares at above the current price of CA$28.65. It's very possible they regret the purchase, but it's more likely they are bullish about the company. To us, it's very important to consider the price insiders pay for shares. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price.
Happily, we note that in the last year insiders paid CA$33m for 1.19m shares. But insiders sold 288.97k shares worth CA$8.9m. In total, Barrick Gold insiders bought more than they sold over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
Barrick Gold is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Insiders at Barrick Gold Have Bought Stock Recently
There has been significantly more insider buying, than selling, at Barrick Gold, over the last three months. Insiders spent CA$21m on shares. But insiders only sold shares worth CA$7.3m. Insiders have spent more buying shares than they have selling, so on balance we think they are are probably optimistic.
Insider Ownership of Barrick Gold
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It's great to see that Barrick Gold insiders own 0.6% of the company, worth about CA$318m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.