Advertisement

Did K2 Gold Corporation (CVE:KTO) Insiders Buy Up More Shares?

We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. 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 shareholders might well want to know whether insiders have been buying or selling shares in K2 Gold Corporation (CVE:KTO).

What Is Insider Buying?

It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, rules govern insider transactions, and certain disclosures are required.

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 Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year.

View our latest analysis for K2 Gold

The Last 12 Months Of Insider Transactions At K2 Gold

In the last twelve months, the biggest single purchase by an insider was when Independent Chairman of the Board John Robins bought CA$175k worth of shares at a price of CA$0.25 per share. That means that an insider was happy to buy shares at above the current price of CA$0.14. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. 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.

In the last twelve months K2 Gold insiders were buying shares, but not selling. You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

TSXV:KTO Recent Insider Trading March 31st 2020
TSXV:KTO Recent Insider Trading March 31st 2020

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

Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. Insiders own 13% of K2 Gold shares, worth about CA$763k, according to our data. We do generally prefer see higher levels of insider ownership.

So What Do The K2 Gold Insider Transactions Indicate?

The fact that there have been no K2 Gold insider transactions recently certainly doesn't bother us. But insiders have shown more of an appetite for the stock, over the last year. We'd like to see bigger individual holdings. However, we don't see anything to make us think K2 Gold insiders are doubting the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing K2 Gold. When we did our research, we found 3 warning signs for K2 Gold (1 is a bit unpleasant!) that we believe deserve your full attention.

But note: K2 Gold may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.

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.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.