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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 True Grit Resources Ltd. (CVE:TGI.H).
Do Insider Transactions Matter?
It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, such insiders must disclose their trading activities, and not trade on inside information.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But equally, we would consider it foolish to ignore insider transactions altogether. 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 True Grit Resources
The Last 12 Months Of Insider Transactions At True Grit Resources
Over the last year, we can see that the biggest insider sale was by the President, Byron Coulthard, for CA$67k worth of shares, at about CA$0.06 per share. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The silver lining is that this sell-down took place above the latest price (CA$0.015). So it is hard to draw any strong conclusion from it. Byron Coulthard was the only individual insider to sell over the last year.
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!
For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Does True Grit Resources Boast High Insider Ownership?
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 27% of True Grit Resources shares, worth about CA$138k. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
So What Do The True Grit Resources Insider Transactions Indicate?
It doesn't really mean much that no insider has traded True Grit Resources shares in the last quarter. We don't take much encouragement from the transactions by True Grit Resources insiders. The modest level of insider ownership is, at least, some comfort. I like to dive deeper into how a company has performed in the past. You can find historic revenue and earnings in this detailed graph.