Have you ever heard of the saying, “follow the money?” If you’ve traded long enough, you probably have, and it’s got everything to do with speculation on big bets based on large trades. You can watch the ticker tape all day and try to find block trades.
You could even spend your time researching dark pool data to determine where the “hedgies” are making their moves. But a basic approach may be the one thing to make this idea of following the money quick and easy. Today we’ll show you what to look at, and a few mining stocks insiders decided to buy recently.
Mining Stocks 30-Second Overview
- Mining stocks are becoming more actively traded in 2022
- When retail traders want to gauge sentiment, they look at things like analyst ratings, what discussions boards say, and what insiders are doing
- Following the money simply means following the activity of big investors (including insiders)
- Today we look at mining stocks that insiders decided to buy recently
There’s no guarantee that an insider buy results in a stock breaking out. You also can’t jump to conclusions if certain insiders are selling. Digging into the details of insider filings can help you discover more about where money is moving and possibly why. I say this because famous tech CEO Jeff Bezos has been cited as “selling” stock. But this headline may be misleading because these sales weren’t sporadic; they were planned out with that schedule filed with the SEC.
On the other hand, you’ve got people like Elon Musk, who recently dumped billions of dollars worth of Tesla stock, which had more of a sentimental impact on TSLA since it wasn’t a planned sale. Today we’ll look at a few minging stocks to watch that insiders decided to buy recently. One of the easiest ways to do that is by looking at Form 4 filings.
Mining Stocks To Buy According To Insiders: Piedmont Lithium Inc. (NASDAQ: PLL)
Piedmont specializes in lithium hydroxide production. With the rise of carbon neutrality and ESG initiatives, alternative energy is becoming a much larger focus for consumers and corporations alike. As far as Piedmont is concerned, it’s positioning itself in prolific regions for lithium hydroxide production. This includes its Carolina lithium project.
Recent feasibility study results suggest improved economics, including a low operating cost profile. Included in these results were an NPV after tax of $2 billion and estimates of annual steady-state EBITDA of nearly $460 million over the first ten years of operating the project. This could bode well for the company as it expects strong demand to boost market value.
“Current and forecasted battery manufacturing capacity now exceeds 500 GWh with public announcements of over $25bb in capital investments to occur in the U.S. by 2025. Based on an average requirement of 960t of lithium hydroxide per GWh of manufacturing capacity, the resultant U.S. demand for lithium hydroxide could exceed 460,000 t/y by 2027.”
With this backdrop to the start of 2022, lithium stocks like PLL could be on the radar. For now, we look to insiders to see what they’ve been up to. Before the end of 2021, EVP Bruce Czachor became the latest insider to buy PLL stock. A Form 4 filing showed his purchase of 1,933 shares at an average price of $51.49. This brought his direct holdings in the company to 10,517.
The Metals Co Inc (NASDAQ: TMC)
Shares of TMC stock have gotten beaten up over the last few months. Since going public via a SPAC transaction in September, DeepGreen Metals – now The Metals Company – has sunk from price levels over $10 to below $2, heading into the New Year. In a classic “buy the rumor, sell the news” type event, TMC stock flopped after coming into the public markets. But if we look at insider activity, some are still optimistic about its future.
One of the main points of focus for The Metals Company is on exploration technology for harvesting lower-impact battery metals. The company does this by exploring seafloor polymetallic nodules. Like Piedmont, TMC is focused on the emerging clean energy transition happening right now. Furthermore, with its strategic partner and stakeholder, Allseas, TMC demonstrated the deep-sea collection system at an industry event.
The Hidden Gem vessel is expected to become the world’s first ship classed as a subsea mining vessel by the American Bureau of Shipping. Furthermore, according to TMC, it has identified 1.6 billion tonnes of nodules containing in situ resources of nickel, cobalt, copper, and manganese equivalent.
Where do insiders stand on TMC stock? At the end of December, CEI Gerard Barron and Director Andrei Karkar through Eras Capital acquired nearly 800,000 shares between the two parties at $2. This price was based on warrants previously purchased and executed. Following this, Eras came back for more on New Year’s eve purchasing 1 million shares of TMC stock between $1.84 and $2.14 for an average cost of $2.09 per share.
Mining Stocks To Buy According To Insiders: Energy Fuels Inc (NYSE: UUUU)
Alternative energy is the theme of this list so far. Energy Fuels continues the trend as its focus is on uranium mining. The company supplies U3O8 to major nuclear utilities. With 3 of America’s major uranium production centers in Utah, Wyoming, and Texas, Energy Metals has worked to establish itself as a significant competitor in the industry.
A recent strategic venture with Nanoscale Powders paired the companies to develop technology for producing rare earth element (REE) metals. Former US President Trump signed Executive Order 13817 (A Federal Strategy to Ensure Secure and Reliable Supplies of Critical Minerals) in 2017. This marked a high point for REE and the industry that has been created since.
Energy Fuels CEO Mark Chalmers explained in a December update that “No other company in the U.S. is currently producing a high-purity REE product ready for separation at commercial levels. We are also quickly moving toward adding solvent extraction separation equipment at the Mill and associated permitting that will allow us to produce commercial separated rare earth oxide powders in the coming years.”
A few days following this development, Chalmers became the latest insider to post a filing for buying UUUU stock. But remember, the devil is in the details. Was this UUUU stock purchase something to suggest recent insider optimism? If you read the filing notes, the purchase was from August and “Inadvertently failed to timely file due to an administrative miscommunication.”
Regardless, shares of UUUU stock have experienced a substantial move even since that August purchase.
It’s always good to do your research. If you’re using a follow the money strategy, that’s, even more, a reason to read the details. Today we showed you a few mining stocks insiders were buying. But, as I’m sure you’ve noticed, not all insider purchases are created equal.
They might’ve originated from warrant executions, failures to timely file, or in other cases, direct purchases in the open market. For these reasons, make sure you’re doing a deeper dive into the filings to see precisely how shares were traded, by whom, and for how much whenever you’re looking for stocks to buy with insider activity.
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