Insiders who bought Green Critical Minerals Limited (ASX:GCM) stock in the last 12 months were richly rewarded last week. The company's market value increased by AU$9.5m as a result of the stock's 36% gain over the same period. In other words, the original AU$162.5k purchase is now worth AU$475.0k.

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 Green Critical Minerals

The Last 12 Months Of Insider Transactions At Green Critical Minerals

The insider Leon Pretorius made the biggest insider purchase in the last 12 months. That single transaction was for AU$162k worth of shares at a price of AU$0.0065 each. We do like to see buying, but this purchase was made at well below the current price of AU$0.019. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

Green Critical Minerals is not the only stock that insiders are buying. For those who like to find small cap companies at attractive valuations, this free list of growing companies with recent insider purchasing, could be just the ticket.

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. From our data, it seems that Green Critical Minerals insiders own 12% of the company, worth about AU$4.3m. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. Whilst better than nothing, we're not overly impressed by these holdings.

What Might The Insider Transactions At Green Critical Minerals Tell Us?

The recent insider purchase is heartening. And an analysis of the transactions over the last year also gives us confidence. But we don't feel the same about the fact the company is making losses. We would certainly prefer see higher levels of insider ownership but analysis of the insider transactions suggests that Green Critical Minerals insiders are expecting a bright future. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Green Critical Minerals. Every company has risks, and we've spotted 5 warning signs for Green Critical Minerals (of which 4 are significant!) you should know about.

Of course Green Critical Minerals 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.

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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.