The recent price decline of 11% in Redbank Copper Limited's (ASX:RCP) stock may have disappointed insiders who bought AU$240k worth of shares at an average price of AU$0.054 in the past 12 months. Insiders purchase with the hope of seeing their investments increase in value over time. However, due to recent losses, their initial investment is now only worth AU$148k, which is not great.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.
Check out our latest analysis for Redbank Copper
The Last 12 Months Of Insider Transactions At Redbank Copper
While there weren't any large insider transactions in the last twelve months, it's still worth looking at the trading.
While Redbank Copper insiders bought shares during the last year, they didn't sell. The average buy price was around AU$0.054. These transactions suggest that insiders have considered the current price of AU$0.033 attractive. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
Redbank Copper is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Does Redbank Copper 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. A high insider ownership often makes company leadership more mindful of shareholder interests. Redbank Copper insiders own about AU$4.9m worth of shares. That equates to 23% 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.
So What Do The Redbank Copper Insider Transactions Indicate?
The fact that there have been no Redbank Copper insider transactions recently certainly doesn't bother us. On a brighter note, the transactions over the last year are encouraging. Insiders do have a stake in Redbank Copper and their transactions don't cause us concern. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Every company has risks, and we've spotted 6 warning signs for Redbank Copper (of which 3 are a bit unpleasant!) you should know about.