It is not uncommon to see companies perform well in the years after insiders buy shares. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So we’ll take a look at whether insiders have been buying or selling shares in Consolidated Zinc Limited (ASX:CZL).
What Is Insider Buying?
It’s quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, rules govern insider transactions, and certain disclosures are required.
Insider transactions are not the most important thing when it comes to long-term investing. But it is perfectly logical to keep tabs on what insiders are doing. As Peter Lynch said, ‘insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.’
Check out our latest analysis for Consolidated Zinc
Consolidated Zinc Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider purchase was by Chris Retzos for AU$180k worth of shares, at about AU$0.008 per share. Although we like to see insider buying, we note that this large purchase was at significantly lower prices. The insider buying may not tell us much about how insiders feel about the current share price.
Over the last year, we can see that insiders have bought 43.05m shares worth AU$528k. On the other hand they divested 22.50m shares, for AU$180k. In the last twelve months there was more buying than selling by Consolidated Zinc insiders. Their average price was about AU$0.012. To my mind it is good 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. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).
Insiders at Consolidated Zinc Have Bought Stock Recently
At Consolidated Zinc,over the last quarter, we have observed quite a lot more insider buying than insider selling. Insiders spent AU$365k on shares. On the other hand, Chris Retzos netted AU$180k by selling. We think insiders may be optimistic about the future, since insiders have been net buyers of shares.
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. Consolidated Zinc insiders own about AU$6.4m worth of shares. That equates to 27% of the company. While this is a strong but not outstanding level of insider ownership, it’s enough to indicate some alignment between management and smaller shareholders.