Abasca Resources Up 50%, Insiders Still Down After CA$10.1m Purchase
Insiders who bought CA$10.1m worth of Abasca Resources Inc. (CVE:ABA) stock in the last year have seen some of their losses recouped as the stock gained 50% last week. However, the purchase is proving to be an expensive wager as insiders are yet to get ahead of their losses which currently stand at CA$6.5m since the time of purchase.
While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.
Abasca Resources Insider Transactions Over The Last Year
The CEO, President & Director Dawn Zhou made the biggest insider purchase in the last 12 months. That single transaction was for CA$3.9m worth of shares at a price of CA$0.25 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being CA$0.09). Their view may have changed since then, but at least it shows they felt optimistic at the time. To us, it's very important to consider the price insiders pay for shares. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.
In the last twelve months Abasca Resources insiders were buying shares, but not selling. The chart below shows insider transactions (by companies and individuals) over the last year. 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 Abasca Resources
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).
Insiders At Abasca Resources Have Bought Stock Recently
Over the last quarter, Abasca Resources insiders have spent a meaningful amount on shares. In total, insiders bought CA$4.2m worth of shares in that time, and we didn't record any sales whatsoever. This makes one think the business has some good points.
Insider Ownership Of Abasca Resources
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It's great to see that Abasca Resources insiders own 65% of the company, worth about CA$8.6m. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
What Might The Insider Transactions At Abasca Resources Tell Us?
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. When combined with notable insider ownership, these factors suggest Abasca Resources insiders are well aligned, and quite possibly think the share price is too low. Looks promising! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Abasca Resources. You'd be interested to know, that we found 5 warning signs for Abasca Resources and we suggest you have a look.
Of course Abasca 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 of direct interests only, but not derivative transactions or indirect interests.
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