We often see insiders buying up shares in companies that perform well over the long term. On the other hand, we’d be remiss not to mention that insider sales have been known to precede tough periods for a business. So we’ll take a look at whether insiders have been buying or selling shares in Golden Dawn Minerals Inc. (CVE:GOM).

Do Insider Transactions Matter?

It’s quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, such insiders must disclose their trading activities, and not trade on inside information.

Insider transactions are not the most important thing when it comes to long-term investing. But it is perfectly logical to keep tabs on what insiders are doing. For example, a Colombia University study found that ‘insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers’.

See our latest analysis for Golden Dawn Minerals

The Last 12 Months Of Insider Transactions At Golden Dawn Minerals

Wolf Wiese made the biggest insider purchase in the last 12 months. That single transaction was for CA$500k worth of shares at a price of CA$0.52 each. That means that an insider was happy to buy shares at above the current price. It’s very possible they regret the purchase, but it’s more likely they are bullish about the company. That purchase may suggest an expectation of positive returns over the long term. Notably Wolf Wiese was also the biggest seller, having sold CA$1.6m worth of shares.

Over the last year, we can see that insiders have bought 2.26m shares worth CA$989k. But insiders sold 4.32m shares worth CA$1.6m. In total, Golden Dawn Minerals insiders sold more than they bought over the last year. The sellers received a price of around CA$0.36, on average. We are not joyful about insider selling. But we note that the selling, on average, was at well above the recently traded price of CA$0.03. The chart below shows insider transactions over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Have Golden Dawn Minerals Insiders Traded Recently?

In the last three months, Wolf Wiese sold CA$157 worth of shares. That’s not much at all. The net selling is so small that it’s hard to draw any conclusions from these recent transactions.

Insider Ownership

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. It’s great to see that Golden Dawn Minerals insiders own 3.5% of the company, worth about CA$61k. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Does This Data Suggest About Golden Dawn Minerals Insiders?

Insider selling has just outweighed insider buying in the last three months. But the net divestment is not enough to concern us at all. We’re a little cautious about the insider selling at Golden Dawn Minerals. We also note that, as far as we can see, insider ownership is fairly low, compared to other companies. Of course, the future is what matters most. So if you are interested in Golden Dawn Minerals, you should check out this free report on analyst forecasts for the company.

Of course Golden Dawn Minerals may not be the best stock to buy. So you may wish to see this free collection of high quality companies.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.