When the ‘captain’ decides to desert his ship, who will be left to take responsibility and deal with the situation?
Market insiders are sceptical. Over the past two years, Bill Beament has overwhelmingly decreased his holdings in Northern Star Resources (NST) from 10,589,712 shares to 3,141,793 as announced in an ASX report on June 2019. A whopping 70% reduction from his shares in the company.
Beament’s massive share sell-offs give rise to doubt and uncertainty among shareholders. Beament is cashing out because he is privy to inside knowledge about the current status and future stance of the company. It is forecast that NST’s share price will decline because of increasing costs, falling resources, and Beament’s poor judgment decisions.
A major red flag
If Beament has confidence in the growth of NST, he should be increasing his holdings. It is a major red flag as he deserts his ship.
The obvious conclusion can only be that Beament is telling shareholders and investors to ‘buy up’ so he can ‘sell down’. In the past 2 years, Beament has sold over 70% of his shareholding in NST.
Insider trading is a matter ASIC will vigilantly pursue. Beament is sure to have a team of very expensive lawyers advising his every move. But, let’s hope that for the sake of NST, Beament does not turn out to be the next Alan Bond.
What happens as Beament deserts ship?
If Bill Beament has no confidence in NST, the market will soon pick up on this and follow suit. Beament has sold off over 70% of his stock. At the same time, he has aggressively overpaid for assets and increased production costs.
With massive share price corrections forecasted, NST shareholders may soon be joining together to create class actions and complain to ASIC. This story has a few more chapters to follow.