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Whilst it may not be a huge deal, we thought it was good to see that the Nimy Resources Limited (ASX:NIM) Executive Director, Neville Hampson, recently bought AU$100k worth of stock, for AU$0.05 per share. Although the purchase is not a big one, increasing their shareholding by only 6.0%, it can be interpreted as a good sign.
See our latest analysis for Nimy Resources
The Last 12 Months Of Insider Transactions At Nimy Resources
In fact, the recent purchase by Neville Hampson was the biggest purchase of Nimy Resources shares made by an insider individual in the last twelve months, according to our records. Even though the purchase was made at a significantly lower price than the recent price (AU$0.10), we still think insider buying is a positive. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.
In the last twelve months Nimy Resources insiders were buying shares, but not selling. They paid about AU$0.06 on average. To my mind it is good that insiders have invested their own money in the company. However, we do note that they were buying at significantly lower prices than today's share price. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
There are always plenty of stocks that insiders are buying. If investing in lesser known companies is your style, you could take a look at this free list of companies. (Hint: insiders have been buying them).
Insider Ownership
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Insiders own 40% of Nimy Resources shares, worth about AU$6.8m. 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 Nimy Resources Insider Transactions Indicate?
It is good to see recent purchasing. And an analysis of the transactions over the last year also gives us confidence. But on the other hand, the company made a loss during the last year, which makes us a little cautious. Insiders likely see value in Nimy Resources shares, given these transactions (along with notable insider ownership of the company). While it's good to be aware of 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. Every company has risks, and we've spotted 6 warning signs for Nimy Resources (of which 3 don't sit too well with us!) you should know about.