Odyssey Gold’s Market Cap Drops To AU$18m Leaving Insiders With Losses


The recent 12% drop in Odyssey Gold Limited’s (ASX:ODY) stock could come as a blow to insiders who purchased AU$1.1m worth of stock at an average buy price of AU$0.033 over the past 12 months. Insiders invest with the hopes of seeing their money grow in value over time. However, as a result of recent losses, their initial investment is now only worth AU$758k, which is not what they expected.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

View our latest analysis for Odyssey Gold

The Last 12 Months Of Insider Transactions At Odyssey Gold

In the last twelve months, the biggest single purchase by an insider was when insider Gregory Howe bought AU$264k worth of shares at a price of AU$0.049 per share. That means that even when the share price was higher than AU$0.023 (the recent price), an insider wanted to purchase shares. 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. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.

Odyssey Gold insiders may have bought shares in the last year, but they didn’t sell any. Their average price was about AU$0.033. These transactions suggest that insiders have considered the current price attractive. 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!

ASX:ODY Insider Trading Volume August 30th 2023

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).

Does Odyssey Gold Boast High Insider Ownership?

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. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It appears that Odyssey Gold insiders own 20% of the company, worth about AU$3.6m. We’ve certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Does This Data Suggest About Odyssey Gold Insiders?

There haven’t been any insider transactions in the last three months — that doesn’t mean much. On a brighter note, the transactions over the last year are encouraging. Overall we don’t see anything to make us think Odyssey Gold insiders are doubting the company, and they do own shares. So these insider transactions can help us build a thesis about the stock, but it’s also worthwhile knowing the risks facing this company. Our analysis shows 6 warning signs for Odyssey Gold (3 make us uncomfortable!) and we strongly recommend you look at these before investing.

But note: Odyssey 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.

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

Find out whether Odyssey 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.



Read More: Odyssey Gold’s Market Cap Drops To AU$18m Leaving Insiders With Losses

2023-08-30 01:48:45

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