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Even though Silver Mountain Resources Inc.'s (CVE:AGMR) stock is down 13% this week, insiders who bought lately made a US$44k profit

Insiders who bought Silver Mountain Resources Inc. (CVE:AGMR) in the last 12 months may probably not pay attention to the stock's recent 13% drop. Even after accounting for the recent loss, the US$485k worth of stock purchased by them is now worth US$529k or in other words, their investment continues to give good returns.

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.

See our latest analysis for Silver Mountain Resources

The Last 12 Months Of Insider Transactions At Silver Mountain Resources

The Chairman Jose Vizquerra Benavides made the biggest insider purchase in the last 12 months. That single transaction was for CA$162k worth of shares at a price of CA$0.32 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being CA$0.30). Their view may have changed since then, but at least it shows they felt optimistic at the time. We always take careful note of the price insiders pay when purchasing shares. 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.

Over the last year, we can see that insiders have bought 1.76m shares worth CA$485k. On the other hand they divested 541.73k shares, for CA$205k. In total, Silver Mountain Resources insiders bought more than they sold over the last year. Their average price was about CA$0.27. It's great to see insiders putting their own cash into the company's stock, albeit at below the recent share price. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

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insider-trading-volume

There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).

Insider Ownership Of Silver Mountain 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. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that Silver Mountain Resources insiders own 24% of the company, worth about CA$14m. 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 Does This Data Suggest About Silver Mountain Resources Insiders?

It doesn't really mean much that no insider has traded Silver Mountain Resources shares in the last quarter. However, our analysis of transactions over the last year is heartening. Insiders do have a stake in Silver Mountain Resources and their transactions don't cause us concern. 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 instance, we've identified 3 warning signs for Silver Mountain Resources (2 are a bit unpleasant) you should be aware of.

Of course Silver Mountain 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, but not derivative transactions.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.

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