Freehill Mining Slides As Insider Purchases Lose Another AU$84k

Insiders who bought AU$627.9k worth of Freehill Mining Limited’s (ASX:FHS) stock at an average buy price of AU$0.004 over the last year may be disappointed by the recent 13% decrease in the stock. This is not good as insiders invest based on expectations that their money will appreciate over time. However, as a result of recent losses, their original investment is now worth only AU$544.1k.

Although we don’t think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.

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Freehill Mining Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider purchase was by insider Gavin Ross for AU$300k worth of shares, at about AU$0.004 per share. That means that even when the share price was higher than AU$0.0035 (the recent price), an insider wanted to purchase shares. It’s very possible they regret the purchase, but it’s more likely they are bullish about the company. To us, it’s very important to consider the price insiders pay for shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.

While Freehill Mining insiders bought shares during the last year, they didn’t sell. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

See our latest analysis for Freehill Mining

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.

Insiders At Freehill Mining Have Bought Stock Recently

Over the last quarter, Freehill Mining insiders have spent a meaningful amount on shares. Non-Executive Chairman Benjamin Jarvis spent AU$125k on stock, and there wasn’t any selling. This is a positive in our book as it implies some confidence.

Insider Ownership Of Freehill Mining

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. Freehill Mining insiders own about AU$4.9m worth of shares. That equates to 39% of the company. We’ve certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Does This Data Suggest About Freehill Mining Insiders?

The recent insider purchase is heartening. And an analysis of the transactions over the last year also gives us confidence. However, we note that the company didn’t make a profit over the last twelve months, which makes us cautious. Insiders likely see value in Freehill Mining shares, given these transactions (along with notable insider ownership of the company). While it’s good to be aware of what’s going on with the insider’s ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. Every company has risks, and we’ve spotted 4 warning signs for Freehill Mining (of which 2 are potentially serious!) you should know about.

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.