Insiders to Silver Lake Resources Limited (ASX:SLR) has sold A$360,000 worth of shares at an average price of A$1.24 per share over the past year, making the most of their investment. The company’s market value fell by A$112 million over the past week after the share price fell 11%, although insiders were able to play down their losses.
While insider trading isn’t the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider trading altogether.
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Silver Lake Resources Insider Trading Over the Past Year
In the past twelve months, the largest single insider sale occurred when Managing Director and Director Luke Tonkin sold AU$360,000 worth of shares at AU$1.24 per share. While we generally don’t like to see insider selling, it’s more of a concern if the selling takes place at a lower price. The silver lining is that this sale took place above the last price (AU$1.02). So this may not shed much light on insider confidence at current levels. The only individual insider salesperson in the past year was Luke Tonkin.
You can see insider trading (by companies and individuals) over the past year illustrated in the table below. If you want to know exactly who sold, how much and when, just click on the chart below!
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Silver Lake Resources insiders sell the shares
Over the past three months, we have seen significant insider selling at Silver Lake Resources. Specifically, Managing Director and Director Luke Tonkin dumped A$360,000 worth of shares around this time, and we saw no buys. This may suggest that some insiders think stocks aren’t cheap.
Silver Lake Resource Insider Ownership
I like to look at how many shares insiders own in a company, to help me get a sense of how aligned they are with insiders. High insider participation often makes company management more concerned with the interests of shareholders. According to our data, insiders own A$3.6 million of shares in Silver Lake Resources, or about 0.4% of the company. We prefer to see high levels of insider ownership.
So what do Silver Lake Resources insider trading indicate?
An insider hasn’t bought shares of Silver Lake Resources in the past three months, but there have been some sales. And even if we look at last year, we haven’t seen any purchases. When you combine that with relatively low insider ownership, we are very cautious about the stock. We would therefore only buy after very careful consideration. So these insider trades can help us build a thesis on the stock, but it’s also helpful to know the risks this company faces. During our analysis, we found that Silver Lake Resources has 3 warning signs and it would be unwise to ignore them.
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For the purposes of this article, insiders are persons who report their transactions to the relevant regulatory body. We currently record open market transactions and private dispositions, but not derivative transactions.
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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.
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