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February 22, 2024
PI Global Investments
Gold

Horizon Gold’s AU$7.2m Market Cap Fall Books Insider Losses


The recent 17% drop in Horizon Gold Limited’s (ASX:HRN) stock could come as a blow to insiders who purchased AU$89.8k worth of stock at an average buy price of AU$0.30 over the past 12 months. Insiders buy with the expectation to see their investments rise in value over a period of time. However, recent losses have rendered their above investment worth AU$74.8k which is not ideal.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

View our latest analysis for Horizon Gold

The Last 12 Months Of Insider Transactions At Horizon Gold

Over the last year, we can see that the biggest insider purchase was by Non-Executive Director James Sullivan for AU$90k worth of shares, at about AU$0.30 per share. So it’s clear an insider wanted to buy, even at a higher price than the current share price (being AU$0.25). 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. To us, it’s very important to consider the price insiders pay for shares. As a general rule, we feel more positive about a stock when an insider has bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price. The only individual insider to buy over the last year was James Sullivan.

The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

ASX:HRN Insider Trading Volume January 6th 2024

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

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 5.8% of Horizon Gold shares, worth about AU$2.1m, according to our data. Overall, this level of ownership isn’t that impressive, but it’s certainly better than nothing!

So What Does This Data Suggest About Horizon Gold Insiders?

The recent insider purchase is heartening. And the longer term insider transactions also give us confidence. But we don’t feel the same about the fact the company is making losses. On this analysis the only slight negative we see is the fairly low (overall) insider ownership; their transactions suggest that they are quite positive on Horizon Gold stock. While we like knowing 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. For instance, we’ve identified 4 warning signs for Horizon Gold (2 are significant) you should be aware of.

Of course Horizon Gold 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 of direct interests only, but not derivative transactions or indirect interests.

Valuation is complex, but we’re helping make it simple.

Find out whether Horizon Gold is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.

View the Free Analysis

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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