In this article, I will feature one gold company that has seen intensive insider buying during the last 30 days. Intensive insider buying can be defined by the following three criteria:
- The stock is purchased by three or more insiders within one month.
- The stock is sold by no insiders in the month of intensive purchasing.
- At least two purchasers increase their holdings by more than 10%.
Continental Gold (OTCQX:CGOOF) primarily engages in the acquisition, exploration, evaluation and development of gold resource properties.
Insider buying during the last 30 days
- Paul Begin purchased 1,000 shares on September 19, and currently holds 5,000 shares or less than 0.1% of the company. Paul Begin serves as chief financial officer. Paul Begin increased his holdings by 25% in September.
- Leon Teicher purchased 11,200 shares on September 9, and currently holds 11,200 shares or less than 0.1% of the company. Leon Teicher serves as a director of the company. Leon Teicher increased his holdings from zero shares to 11,200 shares in September.
- Kenneth Thomas purchased 3,200 shares on August 28, and currently holds 3,200 shares or less than 0.1% of the company. Kenneth Thomas serves as a director of the company. Kenneth Thomas increased his holdings from zero shares to 3,200 shares during the last 30 days.
Insider buying by calendar month
Here is a table of Continental Gold's insider-trading activity by calendar month.
|Month||Insider buying / shares||Insider selling / shares|
There have been 49,400 shares purchased and there have been 819,853 shares sold by insiders since April 2013.
Continental Gold reported the second-quarter financial results on August 7, with the following highlights:
|Net loss||$8.5 million|
Continental Gold had $139 million cash on hand as of August 6, 2013. The company has a $40 million budget for calendar year 2013.
Continental Gold is aiming to produce by 2016 and be part of the lowest quartile of global cash costs and highest quartile of free cash flow on a per capita basis.
There are two other gold companies with operations in Colombia. B2Gold (NYSEMKT:BTG) and AngloGold Ashanti (NYSE:AU) have a joint venture (B2Gold 49% / AngloGold Ashanti 51%) in Colombia. The gold production from this joint venture is expected to commence in 2018. B2Gold's insiders have sold 1,388,382 shares during the last six months.
There have been three different insiders buying Continental Gold and there have not been any insiders selling Continental Gold during the last 30 days. All three of these insiders increased their holdings by more than 10%. Continental Gold has an insider ownership of 16.6%.
Continental Gold has combined measured and indicated resources of 1.6M oz of gold at 13.6 g/t and combined inferred resources of 3.8M oz of gold at 8.8 g/t. Continental Gold is aiming to start production by 2016.
There are seven analyst buy ratings, one neutral rating, and zero sell ratings with an average price target of $7.59. I believe the stock could be a good pick from the current price level based on the intensive insider buying.
Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in OTCQX:CGOOF over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.