Although Atlas Lithium Corporation (NASDAQ:ATLX) shareholders have enjoyed a great week with the stock up 15%, insiders who sold stock over the past year haven't fared as well. The value of their investment would have been higher had they waited to sell their stock.

While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

The Last 12 Months Of Insider Transactions At Atlas Lithium

In the last twelve months, the biggest single sale by an insider was when the Independent Director, Robert Roger Noriega, sold US$75k worth of shares at a price of US$5.09 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of US$5.98. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. It is worth noting that this sale was only 5.4% of Robert Roger Noriega's holding. Robert Roger Noriega was the only individual insider to sell over the last year.

Robert Roger Noriega ditched 25.15k shares over the year. The average price per share was US$4.90. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

I will like Atlas Lithium better if I see some big insider buys.

Insiders At Atlas Lithium Have Sold Stock Recently

The last three months saw some Atlas Lithium insider selling. Independent Director Robert Roger Noriega only netted US$48k selling shares, in that period. It's not great to see insider selling, nor the lack of recent buyers. But the amount sold isn't enough for us to put any weight on it.

Does Atlas Lithium 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. I reckon it's a good sign if insiders own a significant number of shares in the company. It appears that Atlas Lithium insiders own 22% of the company, worth about US$36m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Do The Atlas Lithium Insider Transactions Indicate?

Our data shows a little more insider selling, but no insider buying, in the last three months. However, the sales are not big enough to concern us at all. We're a little cautious about the insider selling at Atlas Lithium. But we do like the fact that insiders own a fair chunk of the company. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing.

Of course Atlas Lithium 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.

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.