Chairman of Royalties Picks Up 1.6% More Stock
Even if it's not a huge purchase, we think it was good to see that Timothy Gallagher, the Chairman of Royalties Inc. (CSE:RI) recently shelled out CA$84k to buy stock, at CA$0.11 per share. Although the purchase is not a big one, increasing their shareholding by only 1.6%, it can be interpreted as a good sign.
The Last 12 Months Of Insider Transactions At Royalties
Notably, that recent purchase by Timothy Gallagher is the biggest insider purchase of Royalties shares that we've seen in the last year. So it's clear an insider wanted to buy, even at a higher price than the current share price (being CA$0.10). Their view may have changed since then, but at least it shows they felt optimistic at the time. In our view, the price an insider pays for shares is very important. Generally speaking, it catches our eye when insiders have purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price. Notably Timothy Gallagher was also the biggest seller.
Over the last year, we can see that insiders have bought 3.21m shares worth CA$282k. But insiders sold 157.00k shares worth CA$16k. Overall, Royalties insiders were net buyers during the last year. Their average price was about CA$0.088. It is certainly positive to see 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!
Check out our latest analysis for Royalties
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 Of Royalties
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. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 32% of Royalties shares, worth about CA$8.7m. 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 Royalties Insider Transactions Indicate?
It is good to see the recent insider purchase. 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. When combined with notable insider ownership, these factors suggest Royalties insiders are well aligned, and that they may think the share price is too low. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For example, Royalties has 5 warning signs (and 3 which can't be ignored) we think you should know about.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.