Bowen Coking Coal Insiders Still AU$425k Away From Original Investment Value

Insiders who bought AU$648.0k worth of Bowen Coking Coal Limited (ASX:BCB) stock in the last year recovered part of their losses as the stock rose by 20% last week. The purchase, however, has proven to be a pricey bet, with losses currently totalling AU$425k.

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Although we don’t think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

View our latest analysis for Bowen Coking Coal

The Non-Executive Director Nicholas Jorss made the biggest insider purchase in the last 12 months. That single transaction was for AU$268k worth of shares at a price of AU$0.067 each. That means that even when the share price was higher than AU$0.006 (the recent price), an insider wanted to purchase shares. It’s very possible they regret the purchase, but it’s more likely they are bullish about the company. To us, it’s very important to consider the price insiders pay for shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.

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Bowen Coking Coal insiders may have bought shares in the last year, but they didn’t sell any. They paid about AU$0.017 on average. I’d consider this a positive as it suggests insiders see value at around the current price. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

Bowen Coking Coal is not the only stock insiders are buying. So take a peek at this free list of under-the-radar companies with insider buying.

Over the last quarter, Bowen Coking Coal insiders have spent a meaningful amount on shares. In total, insiders bought AU$280k worth of shares in that time, and we didn’t record any sales whatsoever. This could be interpreted as suggesting a positive outlook.

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. I reckon it’s a good sign if insiders own a significant number of shares in the company. Our data suggests Bowen Coking Coal insiders own 1.8% of the company, worth about AU$1.1m. However, it’s possible that insiders might have an indirect interest through a more complex structure. I generally like to see higher levels of ownership.

It is good to see recent purchasing. And the longer term insider transactions also give us confidence. But on the other hand, the company made a loss during the last year, which makes us a little cautious. 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 Bowen Coking Coal stock. In addition to knowing about insider transactions going on, it’s beneficial to identify the risks facing Bowen Coking Coal. To help with this, we’ve discovered 3 warning signs (2 can’t be ignored!) that you ought to be aware of before buying any shares in Bowen Coking Coal.

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