Trade Alert: Independent Director Of Andean Precious Metals Michele Ashby Has Sold Stock
We'd be surprised if Andean Precious Metals Corp. (TSE:APM) shareholders haven't noticed that the Independent Director, Michele Ashby, recently sold CA$356k worth of stock at CA$7.25 per share. In particular, we note that the sale equated to a 52% reduction in their position size, which doesn't exactly instill confidence.
Andean Precious Metals Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider sale was by the Founder, Alberto Morales, for CA$96m worth of shares, at about CA$10.50 per share. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. It's of some comfort that this sale was conducted at a price well above the current share price, which is CA$7.04. So it may not tell us anything about how insiders feel about the current share price.
Happily, we note that in the last year insiders paid CA$207k for 25.82k shares. On the other hand they divested 10.04m shares, for CA$102m. Over the last year we saw more insider selling of Andean Precious Metals shares, than buying. The sellers received a price of around US$10.20, on average. Insider selling doesn't make us excited to buy. However, we do note that the average sale price was significantly higher than the current share price (which is CA$7.04). You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
See our latest analysis for Andean Precious Metals
If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: Most of them are flying under the radar).
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. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Andean Precious Metals insiders own about CA$619m worth of shares (which is 57% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
So What Does This Data Suggest About Andean Precious Metals Insiders?
The stark truth for Andean Precious Metals is that there has been more insider selling than insider buying in the last three months. And our longer term analysis of insider transactions didn't bring confidence, either. On the plus side, Andean Precious Metals makes money, and is growing profits. It is good to see high insider ownership, but the insider selling leaves us cautious. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Andean Precious Metals. Our analysis shows 2 warning signs for Andean Precious Metals (1 doesn't sit too well with us!) and we strongly recommend you look at them before investing.
But note: Andean Precious Metals may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.
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 of direct interests only, but not derivative transactions or indirect interests.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.