Insider Buying: The Carpentaria Resources Limited (ASX:CAP) Independent Non-Executive Director Just Bought 42% More Shares

Even if it's not a huge purchase, we think it was good to see that Paul Cholakos, the Independent Non-Executive Director of Carpentaria Resources Limited (ASX:CAP) recently shelled out AU$63k to buy stock, at AU$0.10 per share. While we're hesitant to get too excited about a purchase of that size, we do note it increased their holding by a solid 42%.

See our latest analysis for Carpentaria Resources

Carpentaria Resources Insider Transactions Over The Last Year

Notably, that recent purchase by Paul Cholakos is the biggest insider purchase of Carpentaria Resources shares that we've seen in the last year. Even though the purchase was made at a significantly lower price than the recent price (AU$0.15), 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.

Paul Cholakos bought a total of 2.04m shares over the year at an average price of AU$0.057. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

insider-trading-volumeinsider-trading-volume
insider-trading-volume

There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).

Insider Ownership of Carpentaria Resources

For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Our data indicates that Carpentaria Resources insiders own about AU$4.9m worth of shares (which is 8.1% of the company). We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. Whilst better than nothing, we're not overly impressed by these holdings.

So What Does This Data Suggest About Carpentaria Resources Insiders?

It's certainly positive to see the recent insider purchase. We also take confidence from the longer term picture of insider transactions. But on the other hand, the company made a loss during the last year, which makes us a little cautious. On this analysis the only slight negative we see is the fairly low (overall) insider ownership; their transactions suggest that they are quite positive on Carpentaria Resources stock. 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. Be aware that Carpentaria Resources is showing 5 warning signs in our investment analysis, and 1 of those is potentially serious…

Of course Carpentaria Resources may not be the best stock to buy. So you may wish to see this free collection of high quality companies.

For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions, but not derivative transactions.

This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

Matt Earle

Matthew Earle is the Founder of MiningFeeds. In 2005, Matt founded MiningNerds.com to provide data and information to the mining investment community. This site was merged with Highgrade Review to form MiningFeeds. Matt has a B.Sc. degree with a minor in geology from the University of Toronto.

By Matt Earle

Matthew Earle is the Founder of MiningFeeds. In 2005, Matt founded MiningNerds.com to provide data and information to the mining investment community. This site was merged with Highgrade Review to form MiningFeeds. Matt has a B.Sc. degree with a minor in geology from the University of Toronto.

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