Insiders See US$5.50m Investment In RTG Mining Jump Last Week

RTG Mining Inc. (TSE:RTG) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 11%, resulting in a CA$9.6m rise in the company’s market capitalisation, translating to a gain of 76% on their initial investment. As a result, their original purchase of US$5.50m worth of stock is now worth US$9.68m.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.

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Over the last year, we can see that the biggest insider purchase was by insider Richard Hains for CA$2.7m worth of shares, at about CA$0.028 per share. Even though the purchase was made at a significantly lower price than the recent price (CA$0.05), 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.

Richard Hains purchased 193.55m shares over the year. The average price per share was CA$0.028. 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!

See our latest analysis for RTG Mining

RTG Mining is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.

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. We usually like to see fairly high levels of insider ownership. Our data indicates that RTG Mining insiders own about CA$7.5m worth of shares (which is 7.9% of the company). However, it’s possible that insiders might have an indirect interest through a more complex structure. Whilst better than nothing, we’re not overly impressed by these holdings.

The fact that there have been no RTG Mining insider transactions recently certainly doesn’t bother us. On a brighter note, the transactions over the last year are encouraging. We’d like to see bigger individual holdings. However, we don’t see anything to make us think RTG Mining insiders are doubting the company. In addition to knowing about insider transactions going on, it’s beneficial to identify the risks facing RTG Mining. At Simply Wall St, we’ve found that RTG Mining has 4 warning signs (3 are significant!) that deserve your attention before going any further with your analysis.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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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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.