When corporate insiders are selling their shares, should you do the same? Before you buy or sell stocks in Northern Star Resources Limited (ASX: NST), it is best if you research on whether insiders have been buying or selling shares. It would be a cause for worry if an insider sells shares at around the current share price or even lower.
Beament made the biggest insider sale in 2018
As part of a Family Court settlement, Bill Beament, executive chairman of Northern Star Resources, has sold about $22 million shares in the Perth-based gold miner. It was reported in an ASX Change of Director’s Notice that Beament retains 6,283,588 million shares, which is worth around $56 million, and 3 million performance rights.
It appears that Beament has had other major share sales over the past year. On December 2017, Beament sold 1 million shares which are worth approximately $5.94 million. Recent insider transactions show that he made a sale on December 2018, the same day Northern Star’s $150 million bid for Tribune and Rand’s 49% stake in the East Kundana joint venture was rejected, wherein Beament sold 1 million shares worth $9.1 million. According to reports, he has made the biggest insider sale in 2018, which makes some experts and shareholders question his intentions. Why did he sell his shares?
If Beament had confidence in his management, he would be accumulating not selling down
It is noteworthy that in the last few months, there hasn’t been any inside buying of shares in Northern Star Resources, but there has been some selling. Insiders from the gold miner sold a total of AU$25 million worth of shares, which leaves investors and shareholders cautious.
Why have insiders been selling their shares? Corporate insiders might sell their stocks for a variety of reasons. It may be possible that insiders want to sell their shares before their company’s share price takes a plunge.
Watch the Bill Beament space for rumoured further selling down in the near term.